Union Cabinet Approves Bill To Regulate Chit Funds Industry
The Union Cabinet has approved a bill that seeks to reduce the compliance burden of the registered chit funds industry and protect the interest of subscribers, Information & Broadcasting Minister Prakash Javadekar said in New Delhi on Wednesday.
According to Javadekar, the Chit Funds (Amendment) Bill, 2019, is aimed at fulfilling the objectives of reducing regulatory or compliance burdens of the registered chit funds industry as well as protecting the interest of subscribers.
The government had in 2018 earlier introduced a bill to regulate the chit fund industry but it lapsed, the minister said. The bill was introduced in the Lok Sabha in March 2018 and later referred to a standing committee on finance for scrutiny.
The parliamentary panel had suggested to the government to incorporate element of insurance coverage for subscribers, among other measures, in the chit funds bill.
It also noted that mobilising short-term funds to meet various personal needs has been a chronic problem faced by the general public in developing countries like India.