This startup protects chit fund subscribers

HYDERABAD :  ChitMonks, a Hyderabad based blockchain startup, has launched ChitInsure, an insurance product designed to protect the subscribers of registered chit fund companies. It offers two products — one that helps the companies in providing additional security for new subscriptions while the other is designed to protect the future liabilities of the subscribers. 

Talking to Express, Pavan Adipuram, co-founder of the company said: “A chit fund subscriber has to make monetary contribution to the fund every month. In case one person of a chit fund group does not pay the money, the pool will not be completed, which in turn with affect the company. This is where we step in. We offer the companies general insurance products that covers events like permanent disability, loss of job, critical illness etc. We also offer life term policy in case a subscriber passes away.

In this way, both the chit fund company and subscriber group are protected.” Till now, over 15 companies have partnered with ChitMonks on their ChitFunds 2.0 Platform since its beta launch in September 2020.
Stating that there are over 900 chit fund companies operating in Telangana, the co-founder added: “Chit funds are one of oldest and still relevant financial instruments for people from low and middle income bracket. The hard-earned money of subscribers should be insured, should any of their subscribers discontinue their investment prematurely because of any life event.”

The company’s first offering T-Chits, developed for Telangana government, was a blockchain-based product that allowed government regulators to administer chit fund operations on a private blockchain network. In July 2020, they launched ChitFunds2.0 Platform and ChitPe. ChitFunds2.0 Platform is an online platform to help registered chit fund companies manage their operations, and ChitPe is another platform wherein chit fund companies and subscribers can pay their dues and keep track of their payments. The start-up was founded in 2016 by Pavan Adipuram, Malla Reddy and Sridhar Reddy, who had worked in the banking, financial services and insurance sector before starting the company.

When one is not able to complete chit pool
In case one person of a chit fund group does not pay the money, the pool will not be completed, which in turn with affect the company. This is where we step in. A chit fund subscriber has to make monetary contribution to the fund every month. 

— Kakoli Mukherjee kakoli_mukherjee@newindianexpress.com  @KakoliMukherje2