Thiruvananthapuram: The Pravasi Chitty for Malayalis working or settled abroad and which finance minister T M Thomas Isaac hopes will be the milch cow for the KIIFB projects, has elicited huge response from non-resident Keralites. As on July 12, 1.32 lakh Gulf Malayalis have formally expressed interest in the innovative chitty scheme.
The name, identity and address of all the 1.32 lakh Gulf Malayalis are now with the state, and the canvassing has already begun. The numbers are increasing by the day. On an average 1000 non-resident Malayalis daily call on the toll-free number of Kerala State Financial Enterprises to inquire about the chitty. Over 8,000 of those who have expressed interest have already provided their KYC (know your customer) details and have formally joined the chitty. A top finance department official said that at least 50,000 of those who have already come forward would be made part of the scheme by the time the chitty will be formally inaugurated in the United Arab Emirates on September 15. And this, he says, was just a conservative estimate.
Banking on Ali and Pillai
Besides, the state government is also in talks with top non-resident Keralite businessmen, who employ hundreds of Malayalis in their various concerns in the Gulf, to secure maximum subscriptions for the chitty. The plan is to convince marquee names like M A Yusuf Ali of Lulu Group and Ravi Pillai, who owns the RP Group of Companies, that the chitty will be of immense benefit to their Malayali workforce. Chief minister Pinarayi Vijayan had already held talks with top Malayali businessmen in the Gulf.
“If the Malayali employees in the firms of Yusuf Ali and Ravi Pillai alone agree to be part of the ‘Pravasi Chitty’, it would mean at least 20,000 subscriptions,” the finance department official said. The KSFE's plan is to enroll 10 lakh subscribers in the ‘Pravasi Chitty’ in the next three years.
Chitty with insurance cover
The NRK chitty, though it functions just like a normal chitty, has extra benefits. There will be an insurance cover for non-resident subscribers. If a chitty holder dies, the remaining payment will be made by the insurer. And when the chitty matures, the prize money will be routed to the account of the closest kin. An agreement has already been entered into with LIC. The premium will also be paid by the KSFE from its profits. There will be insurance cover when a chitty holder suffers permanent disability, too.
There are other add-on benefits, too. If the chitty holder dies, the person will be flown to his hometown at the state’s expense. The flight cost of the person accompanying the body will also be met by the state. Perhaps, more importantly there will be a pension scheme. If the subscriber deposits the prize money in a pension fund, she will start to receive a regular monthly pension just when she crosses 60 years.
The various chitties within the Pravasi Chitty have been designed to benefit both the Malayali living in labour camps and also high-earning professionals. The monthly instalments range from Rs 2,500 to Rs 25,000.
The operations of ‘Pravasi Chitty’, which is essentially a fund mobilisation mechanism for Kerala Infrastructure Investment Fund Board (KIIFB), is completely web-managed. Right from applying for the chitty and payment of instalments to the auction and the receipt of the prize money are done online. The instalments can be remitted through online gateways, money transfer companies, or using the KSFE Mobile App. The subscribers can participate in the auction using their smartphone. It will be a virtual auction space where a subscriber will have a clear idea of all the participants, and the amounts they quote. The date and time of the auction will be notified in advance. Even the submission of the mandatory documents like land deeds, and also their verification, are done online.
Free float of Rs 10,000 crore
The KSFE expects a total turnover of Rs 24,000 crore from the operation of the chitty. The hope is that there will be a “free float” of at least Rs 10,000 crore that can be pumped into various KIIFB projects.
The money the non-resident subscriber transfers to the KSFE will be automatically converted as KIIFB bonds through a ‘bond convertor software’. “This does not mean that the KSFE has lost the money once it is put in the bond convertor. There is also the call option. If a certain amount is required to pay the prize money, the amount can be immediately called back,” a top finance department official said. In fact, the money is redeemable on a daily basis. KIIFB will also offer an interest stipulated by SEBI for its bonds.
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