Guest: Manuraj Jain, Founder, Money Club

In this weeks episode we speak to Manuraj who is the CEO of Money Club, a startup which is looking to innovate in the age-old industry of chit funds in India. Manuraj explains how his startup is using ML to improve the entire journey of a customer while participating in a chit fund and also how the government is providing an impetus to this industry by utilizing blockchain technology. 

Chit funds are rotating saving cum borrowing schemes, where a group of people agree to deposit a certain sum of money for certain period of time in a private fund accessible to only that group. For an instance, there is a group of 10 members wherein each member is contributing Rs. 5000 every month. This group will pool up Rs. 50,000 (Rs.5000 x 10 members) every month. To pick this Rs.50,000 amount on the first month, everyone participates in a bidding. The member who bids the highest will get this amount. Suppose Mr. A bids Rs. 9,000 as interest in order to pick Rs. 50,000. In this case, he will get Rs. 41,000 (net) and his Rs. 9,000 will be equally distributed among his remaining 9 group members. Each remaining member will get Rs.1,000 as returns. This process takes place once in every month and the member who picked in first month cannot pick in subsequent months. Since there are 10 members, this chit fund will be active for 10 months.