Kerala to launch chit fund for infrastructural development

The Kerala government aims to raise Rs 10,000 crore from non-resident Keralites (NRK) by launching a chit fund scheme 'Pravasi chitti' for the infrastructural development, said Kerala Finance Minister Thomas Isaac.

Chief Minister Pinarayi Vijayan will inaugurate the registration of subscribers to the Pravasi Chit Funds on June 12,2018  at Legislative Assembly Complex, Thiruvananthapuram.

The 'Pravasi chitti' (as chit funds are called in Kerala) scheme would be managed by the Kerala State Financial Services Enterprises (KSFE), a wholly-owned non-banking company of the state government.

While addressing media, Thomas Isaac announced that KSFE will float Pravasi online Chit Funds from June end.

"The online Pravasi Chit Funds is a unique product of Kerala initially extended to Kerala diaspora working in UAE. Later the services will be available to other gulf countries where around 3 million Keralaites are working. People of Kerala traditionally invest in Chit Funds as saving mode and linked to it emotionally," Dr Isaac explained.

Initially KSFE will float Chit Funds of varied ranges from Rs 3000 to Rs 25000 monthly for three to five years.

"We have designed web platform to join the Chit Funds and customers can complete the registration process by uploading various documents like passport details, visa and Aadhar card to complete the KYC compliance. The customers also can participate in auction bid through the web platform," Peelipose Thomas Chairman of KSFE revealed.

According to the Finance Minister, the funds obtained through the pravasi Chit Funds will be invested in Kerala Infrastructure Investment Fund Board bonds and utilized for the development of the state.

"Within three years, we are planning to invest around Rs 30000 crore for the infra development of the state. When we announced KIIFB, many people raised their eyebrows and viewed it as an Utopian model. Now we have already approved Rs14,387 crore worth projects in the state and Rs 7821.91 crore worth projects have already been tendered. Now we have found a way out to raise mega funds for the development of the state," Isaac told.