Premier financial solution with multiple options to draw prize money

Security Norms

As per section 31 of The Chit Fund Act, 1982, every subscriber who wins the prize must furnish sufficient security to take it. Also, section 22 allows the company to collect sufficient security for the due payment of future subscriptions.

Muthoot Chits offers maximum security options for their customers when taking the prize money. Customers can opt for any one or a combination of the following securities from our security basket.

Gold Ornaments

The value of the gold ornaments should be equal to 100% of the future liability of the member. It is valued currently at Rs.3000/gm.

Assignment of Life Insurance Policies

Only traditional life insurance policies are accepted, and the surrender value of the Life Insurance Policy should exceed 100% of the member's future liability. Additionally, the subscriber needs to obtain a surrender value certificate and assignment confirmation from the Life Insurance company.

Equitable Mortgage by Deposit of Title Deeds (Regd)

The property must be local immovable urban house/commercial property worth more than 150% of the member's future liability. Vacant land & rural properties are not accepted.

Bank Guarantee

Bank Guarantees from scheduled banks that cover 100% of the future liability of the subscriber are accepted.

Fixed Deposits

The subscriber must obtain a lien charge from the bank (scheduled banks), and the fixed deposit must cover 100% of the member's future liability.

Paid up subscription in Non – Prized chits - Pledge of Pass Book

Value in another non-prized Chit can be pledged. Only the paid-up subscription (excluding dividends) minus the Foreman Commission will be considered, and the actual amount should cover the member's future liability in full.

Deposits with the Group company

Fixed instruments (Physical/dematerialized) covering 100% of the subscriber's future liability are also accepted, e.g., NCDs, debentures, FDs, etc

Security Pledge- Dematerialized

Securities from NIFTY100 are accepted if they cover 200% of the subscriber's future liability.

Personal Guarantee/Surety

Surety from a minimum of three qualified individuals is required. The number of sureties needed may increase depending on the nature and value of the future liability.

Eligibility for Personal Surety Guarantors

Experts at Muthoot Chits suggest you opt among the 8 secured security options first for taking prize money. In case the secured options are not available, you can opt for the unsecured option i.e. Personal Guarantors/Sureties. A Personal Guarantee/Surety must fulfil the following 4 eligibility checkpoints to act as security:

A Subscriber should be able to provide surety of minimum 3 eligible persons at the time of drawing the Prize Money
Subscriber/Guarantor/Surety must be any or combination of the following:
  • Government Employees

    Local government employees who draw an unencumbered minimum monthly basic pay as prescribed by the Foreman.

  • Private Sector Employees

    Employees who have completed seven years of service in reputed companies and institutions with PF, Gratuity, and other benefits may be accepted as Sureties at the Foreman’s discretion. They must also provide proof of ownership of immovable property, such as a copy of the sales deed along with the most recent house tax receipt.

  • Business Persons

    Local business owners who have been in business for at least ten years and can provide documentary proof to satisfy the Foreman. Business owners should provide proof of ownership of immovable property, such as a copy of the sales deed and the most recent house tax receipt.

Subscriber/Surety should own properties as per the Grid
Future Liability Slab (Rs) Govt Employee Pvt Sector Employee & Business Person/others
Below 3 lac Minimum of 1 Property document copy on a best-effort basis.
3 lac to less than 5 lac Minimum of 1 Property document copy on a best-efforts basis. Minimum of 1 property document copy Mandatory
5 lac to 10 lac Minimum of 1 property document copy Mandatory Minimum of 2 property document (2 persons) copies mandatory
* Only proof of property (Electricity bill, utility bill, etc) is required as a surety. The subscriber is not required to pledge the property as collateral.
  • The subscriber and all sureties must have surplus income (net salary minus loan instalments), greater than two times the chit instalment.
  • If Subscriber/Sureties are employees, they must have the Basic Pay/Salary as per grid.

Salary Brackets in case of Employee Surety

If the Subscriber/Sureties are employees, they must have the basic pay/salary stipulated in the grid below.

Upto Rs. 10,000/- Rs. 4,500/-
Over Rs. 10,000/- to Rs. 15,000/- Rs, 5,000/-
Over Rs. 15,000/- to Rs. 20,000/- Rs. 5,000/-
Over Rs. 20,000/- to Rs. 25,000/- Rs. 6,000/-
Over Rs. 25,000/- to Rs. 50,000/- Rs. 6,500/-
Over Rs. 50,000/- to Rs. 75,000/- Rs. 8,000/-
Over Rs. 75,000/- to Rs. 1,00,000/- Rs. 8,500/-
Over Rs. 1,00,000/- to Rs, 1,50,000/- Rs. 9,000/-
Over Rs. 1,50,000/- to Rs, 2,00,000/- Rs. 11,000/-
Over Rs. 2,00,000/- to Rs. 2,50,000/- Rs. 12,500/-
Over Rs. 2,50,000/- to Rs. 3,00,000/- Rs. 14,500/-
Over Rs. 3,00,000/- to Rs, 3,50,000/- Rs. 15,500/-
Over Rs. 3,50,000/- to Rs. 4,00,000/- Rs. 17,000/-
Over Rs. 4,50,000/- to Rs, 5,00,000/- Rs. 18,000/-
Over Rs. 5,00,000/- to Rs. 6,00,000/- Rs. 20,000/-
Over Rs. 6,00,000/- to Rs. 7,00,000/- Rs. 23,000/-
Over Rs. 7,00,000/- to Rs. 8,00,000/- Rs. 24,500/-
Over Rs. 8,00,000/- to Rs. 9,00,000/- Rs.26,000/-
Over Rs. 9,00,000/- to Rs. 10,00,000/- Rs. 27,500/-
Over Rs. 10,00,000/- to Rs. 10,00,000/- Rs. 29,000/-
Over Rs. 11,00,000/- to Rs. 12,00,000/- Rs. 33,000/-
Over Rs. 12,00,000/- to Rs. 13,00,000/- Rs. 33,000/-
Over Rs. 13,00,000/- to Rs, 14,00,000/- Rs. 34,500/-
Over Rs. 14,00,000/- to Rs, 15,00,000/- Rs. 36,000/-
Over Rs. 15,00,000/- to Rs, 16,00,000/- Rs. 37,500/-
Over Rs. 16,00,000/- to Rs. 17,00,000/- Rs. 39,000/-
Over Rs. 17,00,000/- to Rs. 18,00,000/- Rs. 40,500/-
Over Rs. 18,00,000/- to Rs. 19,00,000/- Rs. 42,000/-
Over Rs. 19,00,000/- to Rs. 20,00,000/- Rs. 43,500/-
Additional conditions stipulated for liabilities exceeding 10 lakhs, if Personal Guarantor is chosen as security:

Note: The local Chit Branch Manager must be consulted before enrolling a chit.

A few additional conditions need to be fulfilled in cases where the liabilities are greater than ₹10 lakhs.
  • Personal surety of a minimum of four persons
  • Subscriber & Guarantors should be income tax assesses.
  • Copy of bank statement of salary/business account for a minimum of 12 months should be provided
  • Minimum of 3 people among the Subscriber & Guarantors should have property documents. It should be an urban residential or commercial property and not a vacant site. They must submit a copy of the title deed, encumbrance certificate, tax-paid receipt, or electricity bill of 3 properties.
In case of Business Guarantors
  • Subscriber & Sureties must be in business for a minimum period of 10 years. Balance Sheet and Profit & Loss a/c and IT returns with computation sheet, and auditors report for the latest three years should be available.
  • The net profit of the business should be Rs. 10 Lakhs & above for all three years. Net profit of Rs.5 Lakhs & above for all three years may be considered along with a copy of property documents.
  • Successful bidder or at least one of the sureties must have a residential property with NIL encumbrance (without a loan on the property) in a 50 KM radius from the Chit office.
  • Copy of title deed with a forced sale value of 150% of the subscriber’s liability along with NIL Encumbrance certificate (not older than one month) must be submitted.
  • Private sector employees – Minimum service of 7 years with a minimum take-home pay of Rs. 50,000/- after all deductions and loan EMIs
  • Govt sector employees – Permanent employees with a minimum take-home pay of Rs. 50,000/- after all deductions and loan EMIs
  • CIBIL Score of the subscriber & guarantors should be above 650
  • Subscriber & guarantors should be residents within a radius of 50 KM from the Chit office.

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For any queries on the chit group process and security contact us at:

0 8067 8067 00
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