For a change, I was home. I was glancing my personal task
planner cum diary to see the pending story edits and proof reading to be
completed for the day when the phone rang. Sudha aunty, a well-wisher and a
relative (potential oxymoron) had called me to remind me about the pending
payment for the chit fund. I never keep track of this fund, purely because it
is managed by Sudha aunty. There is that element of trust on which this chit
fund operates. Other than the pending payment reminder, she also said that this
month’s payment is the end of this chit fund and that she was about to start a
new chit fund from Jan. I agreed to be part of the new chit fund also and
disconnected the call. My mom heard the conversation and inquired about the
chit fund. The word "chit fund" took her back to her professional days as a teacher. We spoke
about it for more than an hour. When we were done, I wanted to get back to work, but my
mind was roaming around the realms of how my mom spearheaded an entire family’s
offbeat expenses with the chit funds for years together. And in general, those chit
funds’ with a purpose and its role in chasing the dreams of Indian middle
class.
If you are wondering what a chit fund, a.k.a Cheeti
as it is called in vernacular language is, it is a simple rotating savings and
credit system practiced since times immemorial. There is no defined legal
framework. An organizer is usually a trusted relative, a neighbor, friend or
someone who you know at least as an acquaintance, so that there is an element
of trust for the money you invest. People who invest in the chit funds often
have specific goals/dreams that they realize using the returns from it. The
fund starts at an announced date and continues for the number of months predefined
by the organizer. Word of mouth is the only means of marketing and getting
people to invest. When it starts, every month, a fixed amount is collected from
all the subscribers. An open auction is conducted every month to determine the
lowest sum one of the subscribers is willing to withdraw that month. It is also
a credit system because subscribers are allowed to take the entire sum via the
auction even before making full payment. Again, trust is paramount here.
Unlike the post liberalization and digital era, banking was
not accessible to the lower income group as their savings was not distinct and
continuous. If you are an early or mid 80s kids, you’ll know this. But savings
was still required for obvious reasons. Cheeti was a boon for all those who
had this situation. And unlike today, middle class dealt with currencies in mere
tens, hundreds and thousands. Lakhs and crores were not part of even their
wildest dreams.
My mom, being a school teacher, like any other middle-class
Indian woman, was a “penny in pocket, dreams worth million” woman. With
whatever she earned, she managed her finances and savings so meticulously that it puzzles me on how our era's middle class parents managed our upbringing. I
personally know two of her affinities she chased for long, never gave up and
succeeded. Thanks to Cheeti. One was her collection of
sarees and the other was her collection of tools/equipment/apparatus that
reduced her efforts in the kitchen.
Both her affinities were something that my father neither
supported nor cared because of two reasons: One: that they were very feminine
in nature and he did not understand much of it. And secondly, because they were
not one-time investments. In her own words with utensils and sarees, when the usual “WHY DO YOU NEED SO MANY” paradigm come up by husbands for discussion, women do not have answers. So,
mom had to somehow manage them on her own, even financially.
This is exactly where the chit fund, a.k.a. Cheeti
helped my mother. In the early-80s she earned 800 Rs a month. Since she
was a teacher, it was sort of necessary for to have her wardrobe full of
sarees. It so happened that a seller from Surat used to visit her school and
all the teachers collectively insisted him to start a Cheeti, exclusively for
sarees. The monthly amount for the Cheeti was 70 INR which they paid
for 12 months and got a new saree worth 800 Rs. Remaining 40 Rs was a
commission of sorts for the saree seller. She always tells me that back in 80s,
800 Rs had a lot of value. It is true. I just did some math to prorate the
inflation rate of 7.2% at 1985 for 34 years; it turns out, 800 Rs in 1985 is
worth 9330 Rs as on today.
I keep chiding my mother for having so many sarees that we
can sell and pre-close a part of India’s world bank loan. But she laughs it
off. More than the prized possession, she is proud of how she succeeded in filling
her wardrobe with sarees on her own, without a single penny from my father. She is all thanks to this
wonder investment scheme called Cheeti.
By early 90s, utensils with copper bottom was a next gen
thing, she tells me. When the copper bottom utensils were launched in the
market, they were declared hit and received widespread fame among the Indian
mothers. Not just fame, it apparently was also a measure of sophistication and
even a social privilege to an extent. My mom was particularly interested in it
because she believed that copper bottom kadais would help cook faster, thanks
to copper’s good conductance of heat.
But it also came with a heavy price tag that she could not buy them in
one go. Again, the same Cheeti came to my mother’s rescue.
There was a steel vendor near the house, where she started investing 50 Rs a
month and in the end, she could choose utensils worth of 600 Rs. There is this
one copper bottom kadai, which is her favorite. Not because of its quality or
durability, but because she simply succeeded in buying it on her own. It was
the same practical scheme of Cheeti that enabled her to buy a
“RAMA” water filter, a hot box and a few other utensils made of copper.
Her proud possessions after nearly three decades of her
professional career are her Surat Saris, a copper bottom kadai, a RAMA water
filter and a few other kitchen paraphernalia, procured through chit funds. If I
look at it today, it does not seem like a big deal at all! I can buy her all of them at one go! I cannot help but
see her goals mostly revolved around maintaining normalcy and ensuring the
family chores run smooth. Nothing beyond! I think only mothers are the
creatures on this planet who can do such insurmountable sacrifices for the
well-being of their families and yet find solace in those sacrifices.
Here I am, totally delved in the first world problems and not
being able to manage my finances even after earning a 6-digit salary. When my
mom narrates such episodes to me, I can easily realize the perceived absence of
any such pressing concerns that she had as an adult, as a parent or even as a
professional. With real life experiences like chit funds, she beats my argument
and proves that my problems are not actually problems, they are just fallacies
of the relative privation.
I too have invested
in many chit-funds. But if I try to recall If I have bought anything until now,
which has helped facilitate anything at home or brought about changes in running chores at home, nothing
comes to my mind. This has made me realize one thing: Whatever they did, they
had a purpose. And they were bold enough, courageous enough not to take solace
in fallacies, like we all do.
Whoever said “The purpose of life is a life of purpose” is
simply a genius who understood the essentials of life perfectly. Having a purpose
can not only buy you saris, water filters and copper bottom utensils, it can guide
life decisions, influence behavior, shape goals and offer a sense of direction.
Now it doesn’t surprise me that even to this day, chit funds, without a legal
framework, are very instrumental in realizing the dreams of millions of people
out there, because their investments have a purpose. This chit fund episode has
taught me a very important lesson:
To really reap the returns of your investment, it should first
have a purpose.
