Rules for the Money Club

 

  • Individual Contribution
    • A fixed amount that each user contributes towards the club.

 

  • Club Frequency
    • Duration between bidding rounds chosen when the club was created.
    • Fortnightly, Monthly etc.

 

  • Club Amount
    • Total value of the club per round i.e. (Number of members) x (Individual contribution)
    • e.g., In a 5 member club where each member agrees to contribute Rs. 10,000/-, Club amount is 5 x Rs.10,000 = Rs.50,000.

 

  • Bid Date
    • Date agreed by the members of the club for bidding.

 

  • Bid Time
    • Time of the day when the bidding will start on the Bid Date agreed by the Club members according to their availability.

 

  • Bid Window
    • Duration for which the members will be able to bid.
    • The Bidding Window is fixed at 15 minutes.
    • The app sends alarms to members before the bidding starts as a courtesy, however members should ensure not to miss the bidding.

 

  • Defaulted Club
    • A Club will be declared defaulted if any of the following conditions are met:
      • One or more members of a club refuse or fail to make the necessary transfers against a round of bidding before the scheduled start of the next round of bidding.
      • One or more members of a club refuse or fail to confirm the necessary transfers against a round of bidding before the scheduled start of the next round of bidding.
      • In case of a default The Money Club is not responsible for any collections. All users have to settle their transactions offline and The Money Club doesn’t assume any liability.

 

Bidding rules

 

  • Minimum bid amount
    • The minimum amount that the first bidder can bid with.
    • will be 1% of the club amount i.e. If the club amount is Rs50,000 then the min bid amount will be Rs500.
    • will be Rs.1 if 1% of the club amount is less than Rs.1

 

  • Minimum bid increment
    • The minimum difference between two consecutive bids. This is fixed at a standard amount of 50% of the minimum bid
    • e.g taking the above example where the minimum bid is Rs.500. The minimum bid increment will be 50% of 500 = 250
    • will be a minimum of Rs.1 if 50% of the minimum bid is less than Rs.1 and a maximum of Rs.100
    • if Rs.25 < 1/2% < Rs.50, set bid increment to Rs.25
    • if Rs.50 < 1/2% < Rs.100, set bid increment to Rs.50
    • final round commission 0.1% of club amount (10% of 1%)

 

  • Winner to transfer only commission to MC.
  • Rest of the club members share bid amount equally and transfer ((contribution – (bid/(club size -1))) to the winner.
  • In all cases if the amount is less than Rs.1, round it to Rs.1. For other amounts, round the amount to nearest Rs. value.
  • The person who bids the highest wins the round.
  • If no one places a bid for the first few minutes, the system will randomly pick a member eligible for bidding and place a minimum bid on his/her behalf.
  • The last round doesn’t involve bidding.
  • For Priority Clubs, the club owner gets to chose a round that he can pick the amount in, without bidding for it.

 

Fund Transfer Rules

 

  • Once the bidding is complete the app will compute the amounts each one has to pay to the winner.
  • The winner has to transfer 10% of bid amount as commission to the Money Club bank account.
  • The winner has to transfer 10% of the minimum bid amount as commission to the Money Club bank account in both Priority Round and last round.
  • Other members will have to transfer their contribution amount – (bid amount/(n-1)) to the bid winner.
  • The app requires each member to enter the transaction ID of the bank transaction and share it with the recipient to confirm the receipt of funds.
  • The Club can be moved to the next round only after all fund transfers are confirmed by the club members.
  • A club will be declared defaulted if any member of the club fails to pay his/her dues from one bid round before the beginning of the next bid round.
  • All members of the club will receive timely reminders about the pending transactions both through the app and through SMS text messages.
  • After a certain period of time every member of the group will start receiving notifications about all the pending transactions of the club , to ensure full transparency in the process. e.g. if Nishant has NOT paid Naveen yet, Smriti will get notifications to nudge Nishant to pay his dues.