Punjab finance minister Parminder Singh Dhindsa on Tuesday issued instructions to all additional deputy commissioners (development) to take action against all chit fund companies in the state as the state government has not authorised any chit fund company.
During a meeting, Dhindsa designated additional deputy commissioners (development) in all districts as joint director, institutional finance and banking. He said the meeting had been convened to make them aware of the functioning of non-banking financial companies (NBFCs), rights and responsibilities and also about legal issues pertaining to these financial companies.
At present, there is no chit fund company registered with the state government. “Offences under the Prize Chits and Money Circulation Schemes (Banning) Act, 1978, are cognisable and the police can register cases,” he added. He stated that in Punjab, such money-collecting and multi-layer marketing schemes were in operation which were banned under the act. Two types of companies have been registered by the Reserve Bank of India: Category A, which is authorised to take deposits; and category B, which are not authorised to take deposits under RBI Act.