CHAPTER-VI PERCEPTIONAL ANALYSIS OF CHIT MEMBERS AND THE MANAGERIAL STAFF

CHAPTER-VI PERCEPTIONAL ANALYSIS OF CHIT MEMBERS AND THE MANAGERIAL STAFF 212

CHAPTER QUINTESSENCE This chapter is the core of the study and presented comprehensively in two sections. Section-A is a canvass of the perceptional analysis of the chit subscribers who are selected as a sample of 1220 from the universe of chit members both from the registered as well as the unregistered chit fund units spread across the three regions of the state which consist of the coastal Andhra, Rayalaseema and Telangana regions Besides focusing on the demographic profile of the chit subscribers various aspects like the awareness on chit funds, purpose of subscribing to the chits problems faced with the chits, rating of the chits on different aspects, operational and service, satisfaction levels, security considerations etc. have been given due focus in the analysis. Section-B of the chapter is an analytical brief of the perceptions of the total 228 managers and operational staff of the select chit fund units from the three regions of the state. In this section, the perceptions of the select managerial operational staff of the chit fund units have been presented and statistically analyzed for interpretation. Today, in the marketing literature customers are categorized into (a) internal customers (b) external customers. The employees of an organization are the internal customers who can be the source of the reliable firsthand feel of the issues involved as well as the external customers. Therefore, the perceptions of the managerial/operational staff of the chit fund units do assume significance. With this in mind, the perception of the staff of both the registered and unregistered chit fund units have been elicited on permanent issues and presented for analysis and interpretation in this section of the chapter. 213

SECTION A PERCEPTIONAL ANALYSIS OF MEMBERS 214

Age Table 6.1 Demographic Factors (Figures in No s) Type of Chit Mean Std. Dev Test Values Registered Un Registered <25Years 44(48.9) 46(51.1) 90 1.51 0.503 Chi-Square >=25 and <40 Years 331(63.0) 194(37.0) 525 1.37 0.483 =7.95 >=40 and <50 Years 230(58.7) 162(41.3) 392 1.41 0.493 >=50 and <60 Years 162(83.9) 31(16.1) 193 1.16 0.368 >= 60 Years 15(75.0) 5(25.0) 20 1.25 0.444 Gender Male 596(69.22) 265(30.78) 861(100) 1.31 0.462 Correlation =-0.144 Chi-Square =33.376 Female 186(51.81) 173(48.19) 359(100) 1.48 0.500 Marital status Married 716(65.27) 381(34.73) 1097(100) 1.35 0.476 Un Married 66(53.66) 57(46.34) 123(100) 1.46 0.501 Correlation =0.165 Chi-Square =6.479 Correlation =0.073 Region 1.55 0.498 Telangana 244(45.19) 296(54.81) 540(100) Chi-Square =1.528 Coastal Andhra 492(80) 123(20) 615(100) 1.20 0.400 Rayala Seema 46(70.77) 19(29.23) 65(100) 1.29 0.458 Correlation =-0.310 Educational Qualifications Primary Education 53(60.23) 35(39.77) 88(100) 1.40 0.492 Chi-Square SSC/Xth Class 104(50.24) 103(49.76) 207(100) 1.50 0.501 =1.6438 Intermediate 60(51.28) 57(48.72) 117(100) 1.49 0.502 Graduation 412(75.6) 133(24.4) 545(100) 1.24 0.430 Correlation Post G & Above 94(54.65) 78(45.35) 172(100) 1.45 0.499 =-0.088 Others 59(64.84) 32(35.16) 91(100) 1.35 0.480 Note: 1. Figures in side brackets indicate percentage to Row. Source: Survey 215

Table 6.2 Occupational and Economic Factors (Figures in No s) (Income in `) Type of Chit Mean Std. Dev Test Values Registered Un Registered <10000 148(54.81) 122(45.19) 270(100) 1.45 0.499 10000 to <20000 288(62.47) 173(37.53) 461(100) 1.38 0.485 20000 to <30000 196(67.59) 94(32.41) 290(100) 1.32 0.469 Chi-Square =30.118 Correlation =-0.147 30000 to <50000 116(71.17) 47(28.83) 163(100) 1.29 0.454 >=50000 34(94.44) 2(5.56) 36(100) 1.06 0.232 Occupations Government Salaried Employee Private Salaried Employee 137(70.26) 58(29.74) 195(100) 1.30 0.458 161(53.67) 139(46.33) 300(100) 1.46 0.499 Chi-Square =1.563 Self Employed 127(70.56) 53(29.44) 180(100) 1.29 0.457 Business 225(70.31) 95(29.69) 320(100) 1.30 0.458 Correlation =-0.070 Agriculture Based Employment 42(31.11) 93(68.89) 135(100) 1.69 0.465 Others 90(100) 0(0.00) 90(100.00) 1.00 0.000 Note: 1. Figures in side brackets indicate percentage to Row. Source: Survey 216

Age group Vs chit preference Table 6.1 presents the Age Profile of the chit fund subscribers and the preference of the type of chit fund units. As it can be seen from the table, the participation of subscribers below 25 years age group in unregistered firms is 51.1 per cent and it is 48.9 per cent in registered companies. As there is no much significant difference between the two preferences, it can be said that below 25years age group subscribers prefers both the types of chit funds equally. When it comes to the age group between 25 to 40 years, their preference of registered companies is nearly 50 per cent more than the preference of unregistered firms. The third segment i.e., the age group between 40 to 50 years participation in registered companies is more than the unregistered firms and difference is nearly 20 per cent. There is a huge difference between the participants between registered and unregistered chits, which is about 65 per cent in the age group of 50 to 60 years and the trend continues in the age group of above 60 years. It is pertinent to mention that, out of 1220 respondents the age group 25-40years consists of 525 participants in chit industry. It clearly shows that, 25 to 40 years age group participants are more attracted or inclined towards the chit industry rather than any other age group. From the analysis, it is observed that the chit subscribers at the higher levels of age prefer the registered chit funds as against the unregistered. It is vice-versa in the case of the chit members at the lower age profile. This helps to surmise that the experience track of the chit members and their maturity levels associated with the age profile do bear an influence in the preference of the type of the chit fund companies-registered and unregistered. Hypothesis H 0 : Age of the subscriber will not have any influence on preferring chits. Chi-Square value at 0.05 level of significance and degree of freedom 4 is 9.488. Since the calculated value of chi square (7.95) as evident from the table 6.1 is less than the table value of chi square (9.488), the Hypothesis H 0, Age of the subscriber will not have any influence on preferring chits, is accepted. The difference between age group and the preference of chits is not significant. It is also observed from the standard deviation values in the table which are ranging from 0.368 to 0.503, as the age group of the respondents increasing, they show higher stability in preferring chit funds. While the young age group i.e. below 25 years subscribers have less stability in preferring chit funds. There exists negative correlation (-0.144) among the age groups in preferring the type of chit funds. 217

Gender base Vs Preference of Chits Table 6.1 presents the gender base of the chit fund subscribers and the preference of the type of chit fund units. As it is evident from the table, Nearly 70 per cent of male preferring registered chits and 30 per cent preferring unregistered chits whereas, nearly 52 per cent of female preferring registered firms and remaining 48 per cent preferring unregistered firms. Men prefer registered companies 50per cent more than unregistered firms. It clearly shows that the male are more inclined to registered chits and the female are indifferent between the types of chits. Hypothesis H 0 : Gender and the preference of chit funds are independent. Chi-Square value at 0.05 level of significance and degree of freedom 1 is 3.841. Since the calculated value of chi square (33.376) as evident from the table 6.1 is greater than the table value of chi square (3.841) helps to conclude that the Hypothesis H 0 : Gender and the preference of chit funds are independent, is rejected. The difference between the gender and the preference of chit funds is significant. Hence it is concluded that the Gender has influence on preferring the chit funds. In other words, Preference of chit funds is dependent on gender. And it is also been observed from the results of standard deviation values in the table which ranges from 0.462 to 0.500 that, Male have (S.D,0.462) higher uniformity in preferring chits funds, where as female have (S.D,0.500) less uniformity in their preference. There is positive correlation (0.165) between male and female in preferring chit funds. Marital status Vs Type of Chit preferred From the Table 6.1, it is evident that, both married and unmarried respondents preferring the registered companies to unregistered firms. But Married respondents prefer registered chit companies more than unmarried respondents. Whereas unmarried respondents preferring unregistered firms more than married category. There is much variation in preferring registered and unregistered firms in unmarried category. Hypothesis H 0 : marital status has no influence on preference of chit funds. Chi-Square value at 0.05 level of significance and degree of freedom 1 is 3.841. Since the calculated value of chi square (6.471) as evident from the table 6.1 is greater than the table 218

value of chi square (3.841) Hypothesis H 0 : marital status has no influence on preference of chit funds, is rejected. The difference between the parameters i.e., Marital status and the preference of chit funds is significant. Hence it is concluded that the Marital status has influence on the preferring the chit funds. Married respondents are more inclined towards chit funds (89.92 per cent) whereas unmarried respondents do not show much interest in investing chit funds (10.08 per cent). The Standard deviation values ranging from 0.476 to 0.501 in the table revealed that, married respondents are more stable in investing in chit funds. Unmarried investors are not much stable in investing in chit funds. There exists positive correlation (0.073) between the married and unmarried respondents in preferring chit funds i.e. both married and unmarried group are moving in the same direction in their preference in choosing chit funds. Region Vs Type of Chit preferred As it could be seen from the Table-6.1, in Telangana region more number of respondents preferring unregistered chits than the registered chits. In contrast to that in other regions the preference of registered chits are more than unregistered chit firms. In Coastal Andhra it is four times high whereas in Rayala Seema it is 3 times. Among the registered companies the respondents from Coastal Andhra region are nearly 63 per cents and Telangana region occupied second position with 31 per cent. Hypothesis H 0 : Region has no influence on preference of chit funds. Chi-Square value at 0.05 level of significance and degree of freedom 2 is 5.991. Since the calculated value of chi square (1.528) as evident from the table 6.1 is less than the table value of chi square (5.991), Hypothesis that Region has no influence on preference of chit funds is accepted and the difference between the region and the preference of chits is not significant. Hence it is concluded that preference of chit funds is independent on region. There exists negative correlation (-0.310) among the regions in preferring chits.. 219

Education Vs Type of Chit preferred As it is evident from table 6.1, among 1220 respondents the graduates are 44 per cent and nearly 76 per cent of this segment preferring registered chits and the remaining 24 per cent preferring unregistered firms. 60 per cent of respondents who are less educated i.e., below SSC and other qualified also preferring registered and the remaining segments are indifferent between the two types of chits. The major participants in the unregistered firms are from 10 th class, intermediate and postgraduate level of education and they are nearly 50 per cents of their respective segments. The major chunk of the subscribers in chit funds is graduates. From the standard deviation values in the table 6.1 which range from 0.430 to 0.502 it is clear that graduate level subscribers are highly uniform and consistent in investing in chit funds and the primary level educated respondents show less uniformity in their opinion. Remaining qualifications differ in their opinion towards chit funds. Hypothesis H 0 : Education has no effect on the awareness of chit funds. Chi-Square value at 0.05 level of significance and degree of freedom 5 is 11.070. Since the calculated value of chi square (1.6438) as evident from the table 6.1 is less than the table value of chi square (11.070). Hypothesis H 0 : Education has no effect on the awareness of chit funds, is accepted. The difference between the Level of Education and the preference of chits is not significant. Hence it is concluded that Preference of chit funds is independent on education. There exists negative correlation (-0.088) among different education levels in preferring chit funds. Income Vs Type of Chit preferred Table-6.2 reveals that, the overall respondents are divided into five income groups it can otherwise read as lower, lower-middle, middle, upper-middle and upper income group segments and respondents from the middle, lower middle and lower income group segments are participating more in numbers in the chits rather than the other income groups. The preference of registered chits among the middle and above income groups is almost 80 per cent more than that of unregistered chits. The lower income group is indifferent between these two types. Within the registered companies the major part is being occupied by the respondents belong to the second and third segments i.e., the income groups ì.10000 to <ì.20000 and ì.20000 to <ì.30000 they are nearly 60 per cent among registered chit 220

participants. The major players in the unregistered chits are the income groups ì.10000 to <ì.20000 and <ì.10000, they are occupying nearly 66 per cent of the overall participants. Maximum participants of the chit funds belong to the income group less than ì.10000 to ì.30000 (83.69 per cent) and only 16.31 per cent of the participants belong to the income group above ì.30000.so it is concluded that maximum of the subscribers belong to middle and lower income groups. Hypothesis H 0 : income range and preference of chit funds are independent. Chi-Square value at 0.05 level of significance and degree of freedom 4 is 9.488. Since the calculated value of chi square (30.118) as evident from the table 6.1 is greater than the table value of chi square (9.488). Hypothesis H 0 : income range and preference of chit funds are independent, is rejected.the difference between income range and the preference of chit funds is significant. Hence it is concluded that the preference of chit funds is dependent on income level. The values of standard deviations in the table 6.2 which range from 0.232 to 0.499 shows there is high degree of uniformity in the income group above ì.50000 in preferring chit funds and choosing type of the company. While in low income group, the uniformity of preference is less. There exists negative correlation (-0.147) among different income groups in preferring chit funds. With the level of income the subscribers prefer the type of chits differently. Occupation profile Vs Type of Chit preferred As it is evident from Table 6.2 among the participants nearly 69 per cent from agriculture background are opting unregistered chit firms the next place belongs to private salaried. These two occupations are more than 50 per cent among the unregistered chits. Except Agriculture based employment more than 50 per cent of all the remaining occupations are participating in registered companies. The major participants in the registered chits are Business, private and Government salaried respondents, they account for more than 60 per cent. The respondents from business class and private salaried class are participating more than 50 per cents in chits (both forms). This shows that the more respondents who are participating chits are for saving as well as working capital requirement purposes. 221

Hypothesis H 0 : occupation has no influence on preference of chit funds. Chi-Square value at 0.05 level of significance and degree of freedom 5 is 11.070. Since the calculated value of chi square (1.563) as evident from the table 6.1 is lesser than the table value of chi square (11.070). Hypothesis H 0 : occupation has no influence on preference of chit funds, is accepted. The difference between the parameters occupation and preference of chit funds is not significant. Hence it is concluded that the occupation is independent on preferring the chit funds. Among the occupations, the share of participation of business and self employed is 40.98 per cent. Next it is salaried respondents (both government and private) occupying 40.57 per cent of the share, Agriculture respondents 11.7 per cent and retired respondents 7.3 per cent. Business and salaried respondents together they occupy the share of 81.55 per cent. From the values of standard deviations(0.458,0.499,0.457,0.458,0.465,0.000) it is clear that, Business respondents, Government salaried and self employed respondents have uniform level of opinion on chit fund companies, where as the others have not. The correlation coefficient among the different occupational groups is negative (-0.070) and this indicates different occupations prefer chit funds differently. 222

Table-6.3 Time line of association with chits and Type of Chit Company - Cross Tabulation (Figures in No s) Type of Chit Period Registered Un Registered <1 Year 48(42.48) (6.14) 1 to 5 Years 378(61.17) (48.34) 5 to 10 Years 257(75.59) (32.86) >10 Years 99(66.44) (12.66) 782(64.1) (100) Pearson Chi-Square 45.125 Pearson's R [correlation] -0.147 65(57.52) (14.84) 240(38.83) (54.79) 83(24.41) (18.95) 50(33.56) (11.42) 438(35.9) (100) 113(100) (9.00) 618(100) (51.00) 340(100) (28.00) 149(100) (12.0) 1220(100) (100) Mean Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey Std. Deviation 1.58 0.497 1.39 0.488 1.24 0.430 1.34 0.474 1.36 0.480 223

Convenient & contractual way of saving Government Salaried Employee 16(8.21) (9.2) Private Salaried 38(12.67) Employee (21.84) Self Employed 21(11.67) (12.07) Business 57(17.81) (32.76) Agriculture Based 28(20.74) Employment (16.09) Others 14(15.56) (8.05) 174(14.26) (100) Pearson Chi-Square 2.991 Table-6.4 Occupation wise Preference of chit funds - Cross Tabulation Fewer formalities 13(6.67) (9.15) 36(12.00) (25.35) 51(28.33) (35.92) 42(13.13) (29.58) 0(0.00) (0.00) 0(0.00) (0.00) 142(11.64) (100) Reasons for Preferring chit funds Provides Better Dual option future substitute of saving savings for bank &Investment loans 31(15.9) (16.06) 44(14.67) (22.8) 16(8.89) (8.29) 30(9.38) (15.54) 29(21.48) (15.03) 43(47.78) (22.28) 193(15.82) (100) 12(6.15) (14.12) 17(5.67) (20.00) 18(10.00) (21.18) 23(7.19) (27.06) 12(8.89) (14.12) 3(3.33) (3.53) 85(6.97) (100) Pearson's R[correlation] -0.048 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 79(40.51) (30.15) 67(22.33) (25.57) 29(16.11) (11.07) 87(27.19) (33.21) 0(0.00) (0.00) 0(0.00) (0.00) 262(21.48) (100) Better availability of chit operators 15(7.69) (11.81) 35(11.67) (27.56) 22(12.22) (17.32) 30(9.38) (23.62) 12(8.89) (9.45) 13(14.44) (10.24) 127(10.41) (100) Offer better liquidity for short term needs over NSE, Fixed deposits etc 29(14.87) (12.24) 63(21.00) (26.58) 23(12.78) (9.7) 51(15.94) (21.52) 54(40) (22.78) 17(18.89) (7.17) 237(19.43) (100) (Figures in No s) 195(100) (15.98) 300(100) (24.59) 180(100) (14.75) 320(100) (26.23) 135(100) (11.07) 90(100) (7.38) 1220(100) (100) 224

Time line of association with chits Vs Type of Chit From the Table-6.3 it is observed that newly subscribing people below one year experience in saving in chit funds are more with unregistered chits (57.52%) than the registered chits (42.48%). Subscribers having 1-5 years experience are more in registered firms (61.17%) than to unregistered firms (38.83%). Subscribers having 5-10 years experience are also more in registered companies (75.59%) than unregistered firms (24.41%). Subscribers having more than 10 years experience are also more in registered companies (66.44%) than unregistered firms (33.56%). As the time increases the per cent of participants are increasing, with this we can conclude that, once if anyone is entering into chit industry the chances for likely to continue are more in both the forms. It is indicating that the chit industry irrespective of registered or unregistered, maintaining the customer relations and other possible ways to retain the customers with them for longer periods.. Hypothesis H 0 : subscribers do not differ significantly in their association with Chit Company Chi-Square value at 0.05 level of significance and degree of freedom 3 is 7.815. Since the calculated value of chi square (45.125) as evident from the table 6.3 is greater than the table value of chi square (7.815). Hypothesis H 0 : subscribers do not differ significantly in their association with Chit Company, is rejected and hence it is concluded that period of association of subscribers with chit differ significantly and the results of Standard deviation values in the table (0.497, 0.488, 0.430, 0.474 and 0.480) shows that respondents have high degree of uniformity in the association with chit fund companies. The negative correlation (-0.147) among the years of association of the respondents with the chit fund firm indicating that subscribers prefer the chit funds differently as the association with the company is increasing 225

Occupation wise Preference of chit funds From the Table-6.4 it is observed Government salaried respondents (40.5 per cent of them) and private salaried respondents prefer chit funds, due to its dual feature of both saving and investment. Next 15 per cent of them it is due to better liquidity and future savings. Self employed and business respondents prefer because it is convenient with fewer formalities and dual nature. Agriculture respondents and all other occupational respondents prefer, for its better liquidity (40 per cent of them) and next it is for saving. The motivating factors for prefer chit funds in the order are, (1) dual feature of saving and investment; (2.) Liquidity; (3) for future saving; (4) fewer formalities are involved. Hypothesis H 0 : occupations do not differ significantly for various reasons of preferring chit funds. Chi-Square value at 0.05 level of significance and degree of freedom 30 is 43.773. Since the calculated value of chi square (2.991) as evident from the table 6.4 is lesser than the table value of chi square (43.773). Hypothesis H 0 : occupations do not differ significantly for various reasons of preferring chit funds, is accepted. The difference between the occupational background of the respondent and their reasons for preferring chits is not significant. Hence it is concluded that the all the given reasons are effective in preferring chit funds by various occupations. No particular occupation prefers particularly for a purpose. They prefer for all the given purposes time to time. Some times for saving, and the other time for liquidity needs and so on. It is also observed that, dual feature (both saving and investment) of chit funds and liquidity feature are mostly attracting features by all the occupations. The purpose of saving in chit funds by government employees and business class is saving, while private salaried and agriculturists prefer chit funds as it gives better liquidity. There exists negative correlation (-0.048) among the occupations in preferring chit funds for various reasons. 226

Table-6.5 Education qualification wise awareness on Chit Funds - Cross Tabulation (Figures in No s) Level of awareness on Chit Funds Very well Primary 39(44.32) (6.27) SSC 87(42.03) (13.99) Intermediate 57(48.72) (9.16) Graduation 301(55.23) (48.39) 90(52.33) Post Graduation (14.47) Others 48(52.75) (7.72) 622(50.98) (100) Some extent 38(43.18) (9.45) 86(41.55) (21.39) 41(35.04) (10.2) 153(28.07) (38.06) 55(31.98) (13.68) 29(31.87) (7.21) 402(32.95) Pearson Chi-Square 24.403 (100) Very little 8(9.09) (5.52) 29(14.01) (20.00) 14(11.97) (9.66) 64(11.74) (44.14) 22(12.79) (15.17) 8(8.79) (5.52) 145(11.89) (100) Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey Not aware Mean Std. Deviation 3(3.41) 88(100) 3.30 1.146 (5.88) (7.21) 5(2.42) 207(100) 3.21 1.107 (9.8) (16.97) 5(4.27) 117(100) 3.06 1.003 (9.8) (9.59) 27(4.95) 545(100) 3.27 1.152 (52.94) (44.67) 5(2.91) 172(100) 3.22 1.127 (9.8) (14.1) 6(6.59) 91(100) 3.23 1.193 (11.76) (7.46) 51(4.18) 1220(100) 3.23 1.130 (100) (100) 227

Table-6.6 Chit Fund firms wise awareness level of subscribers - Cross Tabulation (Figures in No s) Level of awareness on Chit Funds Type of Company Very well To some extent Very little Not aware Registered Chit 423(54.09) 221(28.26) 100(12.79) 38(4.86) 782(100) (68.01) (54.98) (68.97) (74.51) (64.1) Un Registered Chit 199(45.43) (31.99) 622(50.98) (100) Pearson Chi-Square 22.563 181(41.32) (45.02) 402(32.95) (100) 45(10.27) (31.03) 145(11.89) (100) Pearson's R[correlation] 0.014 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 13(2.97) (25.49) 51(4.18) (100) 438(100) (35.9) 1220(100) (100) 228

Table-6.7 Purpose of Investing in Chit funds By classification of Chit Companies - Cross Tabulation (Figures in No s) Type of Chit Registered Un Registered Conduct &expand business 93(100) 0(0.00) 93(100) (11.89) (0.00) (7.62) To buy consumer durables 83(100) 0(0.00) 83(100) (10.61) (0.00) (6.8) To buy or build house 150(100) 0(0.00) 150(100) (19.18) (0.00) (12.3) For children education 152(97.44) 4(2.56) 156(100) (19.44) (0.91) (12.79) Saving for the old age 74(90.24) 8(9.76) 82(100) (9.46) (1.83) (6.72) Marriage 58(60.42) 38(39.58) 96(100) (7.42) (8.68) (7.87) Agriculture purpose 3(4.76) 60(95.24) 63(100) (0.38) (13.7) (5.16) To pay-off old debts 71(73.96) 25(26.04) 96(100) (9.08) (5.71) (7.87) To buy gold or ornaments 42(100) 0(0.00) 42(100) (5.37) (0.00) (3.44) For medical expenses 28(28.28) 71(71.72) 99(100) (3.58) (16.21) (8.11) To lend to others/invest 0(0.00) 54(100) 54(100) (0.00) (12.33) (4.43) Contingent liabilities. 28(13.59) 178(86.41) 206(100) (3.58) (40.64) (16.89) 782(64.1) 438(35.9) 1220(100) (100) (100) (100) Pearson Chi-Square 7.868 Pearson's R[correlation] 0.689 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey Friedmans Mean Rank Std. Deviation 1.00 0.000 1.00 0.000 1.00 0.000 1.03 0.159 1.10 0.299 1.40 0.492 1.95 0.215 1.26 0.441 1.00 0.000 1.72 0.453 2.00 0.000 1.86 0.344 1.36 0.480 229

Table-6.8 Subscribers Awareness on Chits and Their Bidding Preference - Cross Tabulation (Figures in No s) Awareness on First few chits installments Very well 174(27.97) Bidding Preference Middle installments 156(25.08) Last few installments 211(33.92) No special preference 81(13.02) 622(100) (50.29) To some extent 116(28.86) (54.36) 93(23.13) (48.73) 151(37.56) (52.6) 42(10.45) (50.98) 402(100) (33.53) Very little 41(28.28) (32.4) 32(22.07) (34.87) 52(35.86) (27.27) 20(13.79) (32.95) 145(100) Not aware (11.85) 15(29.41) (11.15) 6(11.76) (12.01) 19(37.25) (12.99) 11(21.57) (11.89) 51(100) (4.34) (2.09) (4.39) (7.14) (4.18) 346(28.36) 287(23.52) 433(35.49) 154(12.62) 1220(100) (100) (100) (100) (100) (100) Mean 1.70 1.61 1.72 1.75 1.69 Std deviation 0.842 0.767 0.841 0.940 0.838 Pearson Chi-Square 9.826 Pearson's R[correlation] 0.024 ANOVA (F Value) 1.327 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 230

Education qualification wise awareness on Chit Funds It is observed from the Table 6.5 that, all education level respondents equally aware of the chit fund companies. The subscribers who are having very well awareness about chit funds are graduates 301(48.39%), post graduates 90(14.47%), Secondary level and intermediate level are 13.99% and 9.16% respectively and the primary and other subscribers put together 13.99%. Among the total respondents of 1220 the number of subscribers who are not aware of chits are 51(4.18%) and the remaining 95.82% subscribers are having awareness at various levels about the chit operations. Hypothesis H 0 : Education has no effect on the awareness of chit funds. Chi-Square value at 0.05 level of significance and degree of freedom 15 is 24.996. Since the calculated value of chi square (24.403) as evident from the table 6.5 is lesser than the table value of chi square (24.996). Hypothesis H 0 : Education has no effect on the awareness of chit funds is accepted and the difference between educational background of the subscriber and his level of awareness of chit funds is not significant. Hence it is concluded that the education and the awareness on chits are dependent. Education has effect on the awareness of chit funds. It is also revealed that, SSC and Intermediate level education has greater uniformity in the opinion, where as Graduation and Post graduation level education has less uniformity in the opinion. Standard deviation values in the table (1.146, 1.107, 1.003, 1.152, 1.127, 1.193, and 1.130) shows that respondents have uniformity in the awareness about chits. Chit Fund firms wise awareness level of subscribers Table 6.6 presents the awareness level of subscribers about chits it is understood that the respondents have much awareness about the chit fund business as well as the type of the company. Out of 1220 respondents more than half of the subscribers 622(50.98%) are very well aware of chit funds functioning and the subscribers who are having moderate level of awareness about chits are 402(32.95%) the customers who are having little to not aware put together are 196(16.07%). The total respondents who are having different 231

levels of awareness about chit funds are 744 out of 782 subscribers which is 95.14 per cent. The respondents from unregistered firms who are having different levels of awareness about chit funds are 425 out of 438 subscribers which is 97.02 per cent among the unregistered firms. Hypothesis H 0 : The level of awareness about the working of chit business is ineffective of the preference of Type of Chit. Chi-Square value at 0.05 level of significance and degree of freedom 3 is 7.815. Since the calculated value of chi square (22.563) as evident from the table 6.6 is greater than the table value of chi square (7.815). Hypothesis H 0 : The level of awareness about the working of chit business is ineffective of the preference of Type of Chit, is rejected Hence the difference between the level of awareness about the working of chit business and the preference of type of chit is significant. It is therefore concluded that, the level of awareness is effective in preferring a Type of Chit. The awareness on chit business and preferring chit funds is dependent. There exists a positive correlation (0.014) between the type of chit and the awareness of the subscriber. Purpose of Investing in chit funds by classification of chit companies It is observed from the table 6.7 that the subscribers invest in chits due to contingent liabilities are 206(16.89%), Children Education purpose156(12.79%), for construction of house 150(12.3%), for medical expenses 99(8.11%),for marriage of self and other family members and to pay off old debts is 96(7.87% each), conduct and expand business 93(7.62%), for consumer durables 83(6.8%), for old age requirements 82(6.72%), they are less than 5 percentage of subscribers are invested for the purposes of investment(4.43%) and for buying gold ornaments(3.44%). Among the registered subscribers the investment made for children education 152(19.44%), for construction of house 150(19.18%), for conducting and expanding business 93(11.89%), for consumer durables 83(10.61%), for old age requirements 74(9.46%), and to pay off debts 71(73.96%) put together 623(79.66%). This gives a clear picture that most of the registered chit subscribers are finding it safe hence they are investing for fulfilling their 232

personal responsibilities. Respondents prefer unregistered firms for entirely different purposes. They prefer unregistered for in the first place, to meet contingent liabilities secondly, to meet medical expenses and agriculture purpose and it is also the performing purposes and marriages. Hypothesis H 0 : purpose of saving in chit fund and the type of chit Fund Company are independent. Chi-Square value at 0.05 level of significance and degree of freedom 11 is 19.675. Since the calculated value of chi square (7.868) as evident from the table 6.7 is lesser than the table value of chi square (19.675). Hypothesis H 0 : purpose of saving in chit fund and the type of chit Fund Company are independent, is accepted. The difference between the two is not significant. Hence it is concluded that purpose of saving and Type of Chit are independent. There is no association between purpose of saving and type of company. The results of standard deviation values ranging from 0.000 to 0.480 also prove that, respondents preferring registered and unregistered firms for entirely different purposes. There exists positive correlation (0.689) between the registered and unregistered chit fund firms as the purpose of saving in the firm is concerned. Subscribers Awareness on Chits and Their Bidding Preference As evident from table 6.8, the respondents who are having very high level of awareness on chit funds are having bidding preference as waiting till last few installments 211(33.92%), First Few installments 174(27.97%),Middle installments 156(25.08%) and remaining 81(13.02%) are not having any preference. Customers who are having moderate level of awareness about chits are having bidding preference for last few installments 151(37.56%), first few installments 116(28.86%), middle installments 93(23.13%) and the subscriber who are not having any special preference is 42(10.45%). This gives a clear picture from the customer awareness point of view that, the bidding at middle and last few installments yields more benefits to the chit subscribers. 233

Hypothesis H 0 : There is no significant difference between the levels of awareness of the respondents on timing of bidding. Chi-Square value at 0.05 level of significance and degree of freedom 9 is 16.919. Since the calculated value of chi square (9.826) as evident from the table 6.8 is lesser than the table value of chi square (16.919). Hypothesis H 0 : There is no significant difference between the levels of awareness of the respondents on timing of bidding, is accepted. The difference between the level of awareness of respondents on chits and the time of bidding is not significant. Hence it is concluded that, there is no significant difference between the levels of awareness of the respondents on timing of bidding. There exists a positive correlation (0.024) between the awareness of chits and the bidding preference. The ANOVA value at 5 per cent level of significance and degrees of freedom υ 1 2 and υ 2 1217 is 3.00. The calculated value of ANOVA is 1.327 from the table 6.8.Since the calculated value of ANOVA is less than the table value of ANOVA the, Hypothesis H 0 : There is no significant difference between the levels of awareness of the respondents on timing of bidding is accepted. It can be inferred from the test results that, there is no significant difference between the levels of awareness of the respondents on timing of bidding. 234

Table-6.9 Opinion of customers on Delay in processing, Bid Restrictions - Cross Tabulation (Figures in No s) Opinion Type of Chit Restrictions faced by customers Registered Un Registered Yes 284(74.35) 98(25.65) 382(100) Delay in processing (36.38) No 498(59.43) (22.37) 340(40.57) (31.31) 838(100) (63.68) Yes 181(61.56) (77.63) 113(38.44) (68.69) 294(100) Bid Restrictions (23.15) No 601(64.9) (25.8) 325(35.1) (24.1) 926(100) Mean Std deviation (76.85) 782(64.1) (100) 1.64 1.77 0.481 0.422 Pearson Chi-Square 25.376 1.081 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 1.78 1.74 0.417 0.438 (74.2) 438(35.9) 100 (75.9) 1220(100) (100) 1.69 1.76 0.464 0.428 235

Table-6.10 Subscribers opinion on General Problems in Chit Fund operations - Cross Tabulation (Figures in NOs) Friedman Type of Chit Mean Rank Registered Un Registered Default of the company 8.67 21(23.6) 68(76.4) 89(100) (2.7) 15.5 7.3 Wontedly Delaying in paying prize money to the subscriber 8.17 111(85.4) (14.2) 19(14.6) (4.3) 130(100) (10.7) Stressing more on security submission Harassing the subscriber with Legal formalities if there is any delay in the subscription money. Improper communication regarding chit dividends and premiums Poor service of the foreman 6.02 129(71.3) (16.5) 6.02 29(60.4) (3.7) 6.02 16(21.1) (2.00) 6.02 48(64.9) (6.1) Unscrupulous protection of returns 6.02 13(21.3) (1.7) 52(28.7) (11.9) 19(39.6) (4.3) 60(78.9) (13.7) 26(35.1) (5.9) 48(78.7) (11) 181(100) (14.8) 48(100) (3.9) 76(100) (6.2) 74(100) (6.1) 61(100) (5.00) Higher penal charges 6.02 147(73.5) (18.8) Lower agency network 6.02 51(70.8) (6.5) Linkage of one scheme payments 6.02 87(79.1) to the other scheme during the (11.1) payment of prized money Processing delay of the prized money 6.02 108(74) (13.8) Need to visit frequently for the 22(66.7) 7.00 prized money (2.8) 782(64.1) (100) Pearson Chi-Square 2.292 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 53(26.5) (12.1) 21(29.2) (4.8) 23(20.9) (5.3) 38(26) (8.7) 11(33.3) (2.5) 438(35.9) (100) 200(100) (16.4) 72(100) (5.9) 110(100) (9.00) 146(100) (12) 33(100) (2.7) 1220(100) (100) 236

Opinion of customers on Delay in processing, Bid Restrictions It is evident from table 6.9 that processing delays are very common and comparatively high in registered companies, whereas in unregistered firms there are no much processing delay for receiving the prize money and the funds available in very less time. It is also evident, that there are no much bidding restrictions with registered companies except the ceiling on bidding. The bidding process is random. Where as in unregistered firms, there are many bidding restrictions like favouring towards some respondents, the bidding process follows, convenient or quota type of selection. Hypothesis I: H 0 : Bid restrictions are independent. Hypothesis II: H 0 : delays in processing money independent on type of the company. Chi-Square value at 0.05 level of significance and degree of freedom 3 is 7.815. Since the calculated values of chi square (25.376 and 1.081) as evident from the table 6.9 is lesser than the table value of chi square (7.815). Hypothesis I; H 0 : Bid restrictions are independent, is rejected. It is concluded that, the delays and bidding restrictions are dependent on the type of the company. Hypothesis II; H 0 : delays in processing money independent on type of the company, is accepted, and is concluded that bid restrictions are independent on the type of the company. Subscriber s opinion on General Problems in Chit Fund operations The general problems faced by the subscribers in the chit fund firms are shown in table 6.10. The registered firm subscribers opined that the issues like Higher penal charges 147(18.8%), Stressing more on security submission 129(16.5%), Wontedly Delaying in paying prize money to the subscriber According to the shows that, the default of unregistered firms is more than 90 per cent and it is below 10 per cent in registered companies in the sample. Delayed payment of prize money is very common in registered companies (almost 75 per cent) than in unregistered firms. Security submission is highly required and high legal formalities in registered companies, whereas in unregistered firms it is more the reliability not the security submission, and there are no legal formalities. 237

High Agency network is present in registered companies, and it is through word of mouth and between the known respondents the business is mostly conducted in unregistered firms. Hypothesis H 0 : There is no effect of problems with chit funds on the preference of the company. Chi-Square value at 0.05 level of significance and degree of freedom 11 is 19.6759. Since the calculated value of chi square (2.292) as evident from the table 6.10 is lesser than the table value of chi square (19.6759). Hypothesis H 0 : There is no effect of problems with chit funds on the preference of the company, accepted and it is concluded that problems faced with chit funds are not affecting the preference of registered and unregistered firm. Friedman s test is used to identify the series of problems faced by the chit subscribers from the chit operators which are significant influence on the chit subscribers building the relationship block. As can be seen from the table-6.10, Default of the company (8.67) is being ranked first followed by the statement Wontedly Delaying in paying prize money to the subscriber (8.17). Need to visit frequently for the prized money (7.00). All the remaining problems have been given equal rank with 6.02. This clearly indicates the most significant problems are Default of the company, wontedly delaying the prize money and frequent visits of the subscribers for prize money. 238

Table-6.11 Percentage of Dividend Received by Type of Chit - Cross Tabulation (Figures in No s) Type of Chit Dividend Registered Un Registered <=5 208(59.6) (26.6) >5 to <=10 334(63.9) 141(40.4) (32.2) 189(36.1) 349 (28.6) 523 (42.7) >10 to <=15 134(69.8) (17.1) >15 106(67.9) (43.2) 58(30.2) (13.2) 50(32.1) (42.9) 192 (15.7) 156 Pearson Chi-Square 6.792 (13.6) 782(64.1) (11.4) 438(35.9) Pearson's R[correlation] -0.068 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey (12.8) 1220 239

Per cent of Dividend Table-6.12 Percentage of Dividend Received by Chit Values - Cross Tabulation <=10000 <=5 68(19.48) >10000 and <25000 256(73.35) >25000 to 100000 25(7.16) >100000 to 300000 0(0.00) (Figures in No s) >300000 0(0.00) 349(100) (63.55) >5 and <=10 31(5.93) (54.94) 191(36.52) (5.11) 266(50.86) (0.00) 22(4.21) (0.00) 13(2.49) (28.61) 523(100) (28.97) >10 and <=15 8(4.17) (40.99) 19(9.9) (54.4) 129(67.19) (33.33) 20(10.42) (14.13) 16(8.33) (42.87) 192(100) (7.48) >15 0(0.00) (4.08) 0(0.00) (26.38) 69(44.23) (30.3) 24(15.38) (17.39) 63(40.38) (15.74) 156(100) (0.00) (0.00) (14.11) (36.36) 107(8.77) 466(32.79) 489(34.41) (100) (100) (100) Pearson Chi-Square 7.526 Pearson's R[correlation] 0.658 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey (68.48) 66(4.64) (100) (12.79) 1220(100) (100) 240

Rating Procedural Aspects 0 Poor (0.00) Average 15 Table-6.13 Rating of Chits on Qualitative Aspects - Cross Tabulation (1.23) Good 407 (33.36) Very Good 391 (32.05) Excellent 407 (33.36) Financial Soundness 25 (2.05) 20 (1.64) 145 (11.89) 395 (32.38) 635 (52.05) Aspects Track Record 0 (0.00) 45 (3.7) 201 (16.5) 449 (36.8) 525 (43.0) (Figures in No s) Trustworthiness 5 (0.4) 20 (1.6) 170 (13.9) 625 (51.2) 400 (32.8) 1220(100) 1220 1220 1220 (100) (100) (100) (100) ANOVA (F Value) 197.757 42.536 230.134 345.344 Pearson's R [correlation] -0.566-0.179-0.399-0.470 Note 1. Figures in side brackets indicate percentage o Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 241

Percentage of Dividend Received Vs Type of Chit It is evident from Table-6.11 that the per cent of dividend received are relatively high with registered companies. The per cent of dividends ranges from minimum 5 to maximum15. 81 per cent of respondents opined made it clear that the minimum dividend they get would be 5 per cent. And 64 per cent of respondents said that it is 5-10 per cent and 70 respondents, it is 10-15 per cent. 68 per cent respondents opinioned it is above 15 per cent. These opinions expressed more or less similar in case of unregistered firms. Hypothesis H 0 : The dividend received has no effect on the preference of the Type of Chit. Chi-Square value at 0.05 level of significance and degree of freedom 3 is 7.815. Since the calculated value of chi square (6.792) as evident from the table 6.11 is lesser than the table value of chi square (7.815). Hypothesis H 0 : The dividend received has no effect on the preference of the Type of Chit, is accepted and it can be said that, dividend received has no effect on the preference of the registered and unregistered chit firm. The negative correlation (-0.068) between the type of chits indicate that the percentage of dividend received is different in different type of chits. Percentage of Dividend Received Vs Chit Values As could be seen from Table-6.12 that, the percentage of dividend earned and the value of chit they are associated with. The dividend received is greater than 15 for those chits where the chit value is > ì. 25000. The dividend <=5 for those chit values which are < ì. 100000. Maximum number of respondents in the dividend category of 5 per cent are in the chit group of ì.10000- ì.25000.maximum of the respondents under the dividend category of 5-15 per cent are in the chit group ì.25000- ì.100000.and 44.23 per cent of respondents who receive dividend above 15 per cent belong to chit value ì. 25000 to ì.100000 and 40.38 per cent of the respondents receive dividend above 15 per cent belong to above ì. 300000 chit value. 242

Hypothesis H 0 : there is no association between dividend received and the chit values. It is evident from the table that, maximum of the respondents belongs to chit value ì.25000 to ì.100000 who receive dividend ranging 5 per cent to above 15 per cent. Chi- Square value at 0.05 level of significance and degree of freedom 3 is 7.815. Since the calculated value of chi square (7.526) as evident from the table 6.12 is lesser than the table value of chi square (7.815). Hypothesis H 0 : there is no association between dividend received and the chit values, is accepted. And it can be said that, there is no association between the dividend and the value of chit. There exists positive correlation (0.658) between the chit value and the dividend received. This indicates that the dividend received is increasing with the chit value invested. Rating of Chits on Various Aspects Vs Type of Chit Cross Tabulation Through a peep into Table 6.13 it is observed that, 72 per cent of the respondents opinioned that the registered companies are excellent. The reliability rating of registered companies is between good to excellent. When it comes to unregistered firms, the reliability rate is comparatively less than the registered companies. There is very negligible number of respondents rated poor or average for the companies. Registered companies have been rated from good to excellent by 35 per cent to 100 per cent of the respondents respectively, and unregistered firms are rated from average to good by 93 per cent and 64 per cent of the respondents. There exist negative correlations (-0.566, -0.179, -0.399, and -0.179) between the qualitative aspects of the rating of chits. ANOVA value at 5 per cent level of significance and degrees of freedom υ 1 4 and υ 2 1215 is 3.00. The calculated values of ANOVA are 197.757, 42.536, 230.134 and 345.344 from the table 6.13. Since the calculated values of ANOVA are greater than the table value of ANOVA the, Hypothesis H 0 : there is no significant difference in the rating of chits basing on the various aspects mentioned in the table 6.13, is rejected. It can be inferred from the test results that, there is a significant difference in the rating of chits basing on the various aspects like procedural aspects, financial soundness, track record and trustworthiness. 243

Table-6.14 Rating on Service of The Company by Type of Chit - Cross Tabulation (Figures in No s) Type of Chit Service of The Company Registered Accessibility 60(77.92) (7.67) Quick Processing 43(48.86) Commission Charged by the Company (5.5) 282(70.15) (36.06) Honesty of the foreman 259(61.08) (33.12) Reliability of the company 32(47.06) Un Registered 17(22.08) (3.88) 45(51.14) (10.27) 120(29.85) (27.4) 165(38.92) (37.67) 36(52.94) 77 (6.31) 88 (7.21) 402 (32.95) 424 (34.75) 68 (4.09) (8.22) (5.57) Favorable bidding 81(68.07) 38(31.93) procedure 119 (10.36) (8.68) (9.75) Availability of the money 25(59.52) 17(40.48) when needed. 42 (3.2) (3.88) (3.44) 782(64.1) 438(35.9) 1220 (100) (100) (100) Pearson Chi-Square 33.115 Pearson's R[correlation] 0.047 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey Mean Std. Deviation 1.22 0.417 1.51 0.503 1.30 0.458 1.39 0.488 1.53 0.503 1.32 0.468 1.40 0.497 1.36 0.480 244

Table-6.15 Satisfaction Level of Customer and Type of Chit - Cross Tabulation (Figures in No s) Type of Chit Satisfaction Level Satisfied Neither Satisfied Nor Dissatisfied Dissatisfied Registered Un Registered 432(61.28) (55.24) 100(76.34) (12.79) 250(65.1) (31.97) 273(38.72) (62.33) 31(23.66) (7.08) 134(34.9) (30.59) 782(64.1) 438(35.9) (100) (100) Pearson Chi-Square 11.133 Pearson's R[correlation] -0.045 ANOVA (F Value) 5.604 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 705(100) (57.79) 131(100) (10.74) 384(100) (31.48) 1220(100) (100) 245

Table-6.16 Level of Awareness on Various Financial Institutions by Type of Chit - Cross tabulation (Figures in No s) Level Banks PPF Very Low Low Moderate High Very High Chi Square Value Pearson s R [correlation] 0 (0.00) (0.00) 18(4.83) (1.5) 31(5.60) (2.5) 836(34.73) (68.5) 335(18.88) (27.5) 1220(20.0) 831(83.68) (68.1) 239(64.07) (19.6) 100(18.08) (8.2) 39(1.62) (3.2) 11(0.62) (0.9) 1220(20.0) Financial Institutions Cooperatives and Postal Savings 0(0.00) (0.0) 75(20.10) (6.1) 18(3.25) (1.5) 789(32.78) (64.7) 338(19.05) (27.7) 1220(20.0) Shares and Mutual Funds 157(15.81) (12.9) 33(8.84) (2.7) 378(68.35) (31.0) 652(27.08) (53.4) 0 (0.00) (0.00) 1220(20.0) FD and Insurance 5(0.5) (0.4) 8(2.14) (0.7) 26(4.70) (2.1) 91(3.78) (7.5) 1090(61.44) (89.3) 1220(20.0) 9.357 1.414 30.299 68.620 33.353 0.042 0.151 0.104-0.196-0.043 Note 1. Figures in side brackets indicate percentage to Row. 2. Figures in lower brackets indicate percentage to Column. Source: Survey 993(100) (16.25) 373 (6.10) 553 (9.05) 2407 (39.39) 1774 (29.03) 6110(100) 246