New Delhi: The Lok Sabha passed the 2019 Chit Funds (Amendment) Bill on Wednesday, which seeks to create a framework for ensuring accountability in chit fund schemes and protecting subscribers. The bill seeks to amend the 1982 Chit Funds Act, which governs chit funds and forbids the establishment of a fund without a state government's prior approval. The legislation raises from the current Rs 1 lakh the prescribed maximum amount of aggregate chit fund for individuals to Rs 3 lakh. In the case of companies, the limit was raised from Rs 6 lakh to Rs 18 lakh. Terms such as 'gross chit amount', 'share of discount' and 'net chit amount' have been substituted with 'chit amount', 'dividend' and 'prize amount' in the Act,
The Center brought the bill in the wake of several recent chit fund scams where thousands of subscribers lost their investments.
