- How does money move on the app?
Money is secure in your own bank account till the bidding takes place. Once the winner is declared, everyone transfers their funds from their respective bank account to the winners bank account. This is currently done off the app , either through IMPS, NEFT, or UPI or even in cash. All you have to do is confirm it on the app.
We are working to integrate UPI payments on the app so that users can transfer money using a few clicks from our app itself.
- I save through FDs. How is this better?
Bank offers 6%-7% per annum on fixed deposits. With Money club the rate of interest may exceed over 12% per annum, thereby redefining the paradigms of savings in our mind. Since we have created a platform that connects borrowers and lenders directly and removed the bank from the middle, the 8%-10% spread that the banks keep is shared between the borrowers and lenders and hence both gain in the process.
- What is the difference between normal borrowing and through the Money club app?
Normal borrowing requires the borrower to fill up long forms and deposit piles of paperwork if he is borrowing from banks. If the user is borrowing from individuals then he has to call or meet a few trusted people before he can convince them about repayments. Life can be made simpler for such circumstances.
At Money Club you get into a pre- agreed arrangement with your trusted ones. The agreement is that you will pick up the funds when you really need it. If there are 2 or more people who want to pick up the pooled amount , they bid their interest rates for it. The highest bidder wins the pool.
Its a way to create a trusted community that have agreed in advance to help each other out in times of need!
- With whom should I club?
Money club advises you to pool up with your friends, colleagues and people you trust with a specific amount of money. Start with a small amount with people who you meet or see everyday and then increase the amounts gradually.
- Why should I do this online when I can do the same thing offline?
Members can form groups with their friends who don’t live in the same geography, hence physical proximity is not required as in the case of an offline model.Trust transcends borders, so why should we be limited with physical proximity.
The app automates all communications. It informs everyone when the bid is due, when their payments are due, and also keeps everyone in the group informed about who has paid and who is yet to pay up. This smartly ensures that a joint liability is created and hence reduces the chance of default. Try doing this manually and you will see how much quality time it can consume..
- How can I contribute and receive money? How much money can I start with?
Users only need to make a commitment when they join a club on the app. This doesn’t require them to transfer funds at that time. Once a bid takes place, the amount is directly transferred by users from their accounts to the winners bank account. To receive funds , user needs to mention the bank account in to which they want the funds to come in.
The minimum contribution amount to form a club on the app is Rs 500.
- What happens when no one bids?
If no one is bidding for the first 1.5 to 2 minutes when the countdown starts, the Money club app would run a algorithm to identify a member randomly. It will then bid the minimum amount on his/her behalf to start the bid. Bidding can then proceed normally post that.
- How long would the bidding time last?
The bidding time is 15 minutes. A countdown timer of 15mins will start automatically when the clock reaches the bid time.
- What is the mechanism used to check defaulters?
Risk of defaulters is not handled by Money club. Customers are advised to form clubs only with people they completely trust with their money. However in order to keep defaulters at bay, the app has the policy of permanently blocking the member from forming any more clubs on the platform.
10. What is the amount charged by Money Club?
Money Club charges a minimum of 0.1% of the total pooled amount from the winner of the bid. No other charges are applicable to the user.
11. How many times can I borrow money from my group?
Every member of the club gets 1 chance to pick up the pooled amount in the cycle.
12. How many clubs can I join at a given point in time?
Users can form or join as many clubs as they want.
13. Can I leave a group?
Yes. But not after the club is active. A club becomes active the moment all members join the club before the first round and the club admin activates the club.
14.What happens after a Money Club ends?
The club will be closed and moved to your history list. You can form a new club or join another one.