The definitive guide to South Asian lingo

Definition 1 of 1

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Noun. April 29, 2013, Word of the Day
2

Definition

A preferred system for raising lump sum cash in small communities throughout India. Sadly, it is frequently a ponzi scheme, where contributors to the fund get cheated out of everything with the organizer scooping up all. I haven’t the faintest idea of what “chit” stands for.

Usage

I don’t trust banks, madam. Even big, big banks are sometimes going bankrupt. With chitfund, it is safe. We know all the parties, you see. My own uncle and his brother-in-law are running a chitfund. In banks, managers come and managers go. How can we trust them?
Added 2011-09-16 by oldathai

Root

English

Region

All India

Categories

Money & Business

Comment

Comments
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Missing
gundee

A chit is the receipt for the money put into the fund by the members of the group.

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Missing
jobless

I think `chit' corresponds to the old way it worked. You bought in to it by paying a certain amount. Names were written on a piece of paper - a `chit' - and placed in a bowl. A draw was made and the winner got to keep all the money. In other words, its a good old fashioned lottery.

Nowadays I suppose its just a Ponzi scheme where I guess the draw is rigged.

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