New halal option in Kerala's savings scheme for expats in UAE

New halal option in Keralas savings scheme for expats in UAE
Kerala's Finance Minister Thomas Isaac addresses audience at Kerala Social Centre in Abu Dhabi.-Supplied photo

Abu Dhabi - There will be no auction or implicit interest rate. Each chit fund will have just 12 to 20 subscribers.


Ashwani Kumar

Published: Sat 28 Sep 2019, 10:00 PM

Last updated: Sun 29 Sep 2019, 12:22 AM

The Kerala State Financial Enterprises (KSFE) Pravasi Chitty, the savings scheme for expats from the state, is now Shariah-compliant, an Indian minister said in Abu Dhabi.
Kerala's Finance Minister Thomas Isaac said the chit fund scheme is now available with an additional 'halal' option and some added features on
"There will be no auction or implicit interest rate. Each chit fund will have just 12 to 20 subscribers. Every month the full amount will be given to a subscriber, who will be selected after a discussion to ascertain the neediest person. If they can't reach an agreement then a draw will be held," Isaac told Khaleej Times during an exclusive chat at Kerala Social Centre in Abu Dhabi.
There are some 'unique' savings scheme strategies introduced to lure maximum subscribers, including companies, associations, community forums, college alumni etc.
"Over 3,000 projects worth Rs500 billion are being implemented in Kerala. This (chit fund) will be used to partly finance some of these projects. Any organisation or group interested in funding can sponsor by providing the total subscription amount of the project."
As an add-on, the name of the contributing group will be displayed on the name boards of the completed projects. "I am certain all organisations will want to have their name on the plaque of a local hospital, school or road. I am hopeful that lots of new subscribers will join the chit fund through these organisations. I am hoping the number of subscribers from the Gulf region soars past 50,000 by the year end."
Meanwhile, presidents of India Social and Cultural Centre, Indian Islamic Centre and Abu Dhabi Malayalee Samajam attended the event and assured full support for the savings scheme.
'UAE, Gulf main market'
When asked about the response so far to chit fund, Isaac acknowledged that the number of subscribers, just over 10,000, was disappointing. He hoped the new measures announced will lift public participation. "We are not satisfied with the numbers. Last year, when we were getting ready for a campaign, the floods happened followed by the general elections. It wasn't opportune time for us to conduct a major campaign. Now after a year, we are on the road to mobilise subscribers for chit fund," said the minister, who on a three-day brief visit.
The customer statistics until Thursday, a copy of which is in possession of Khaleej Times, shows that out of 10,244 chit fund subscribers worldwide, as many as 6,842 are from the UAE. Collective stats of Middle East add up to 10,111 subscribers (UAE 6,842, Qatar 897, Saudi Arabia 880, Kuwait 533, Oman 549 and Bahrain 410), with rest of the European countries seeing only 133 participants. "The Gulf region remains our main market. From now on, chit fund is going global."
Reaching out to millennials
Kerala's Finance Minister Thomas Isaac urged the millennials residing in various parts of the world to show 'a bit of patriotism'.
"They have an opportunity to be part of development projects in their localities. Tech-savvy millennials should also be attracted by the use of online methods for chit fund. We will reach out to them with advertisements and brochures in English."
Going forward there are plans to make the chit fund open to all non-resident Indians. "We may open it to all NRIs. It's a possibility," Isaac added on future plans to bring more funds for development for flood-hit state.

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