The chit fund also known as chitty, or kuri in India and ROSCA (Rotating Savings and Credit Association) internationally, occupy a unique position in the financial system of India. This indigenous financial institution prevalent even before the evolution of banking, had its origin in Southern of India, when the transactions were in the Barter System.

From a humble beginning to its present gigantic growth, the chit fund Institution has now attained the status of a quasi-banking system, and has turned out to be a boon to the aggressively growing economy of the nation. According to a report of Asian Development Bank, the turn over of some 1066 chit fund companies, as far back as 1986 was, an astounding Rs.81.6 billions. The estimated turnover of Registered Chit companies all over India as of now is exceeding Rs 35,000 crores per annum. Under the aegis of M/s Bill & Melinda Gates Foundation, we are on the process of reaching the Lower and Middle income household, in the Micro Finance model. Institute of Financial Management and Research, Chennai , who were engaged for the first ever study of this Industry on an all India basis is now on the process of launching different Pilot Projects in this regard.


  1. It is a borrowing cum savings instrument
  2. The rate of borrowing is determined by the participants themselves and not by an external agency
  3. The intermediation cost is the lowest when compared to other instruments
  4. The process of intrinsic evaluation based on factors like Social Collateral etc give a lead this Institution, over the formal Banking sector, as an Financial Inclusion Activist etc.