The Prize Chits and Money Circulation Schemes (Banning) Act, 1978 aims to prohibit and regulate the operation of prize chits and money circulation schemes in India. These schemes typically involve a promise of prize winnings or money by participating in a circulation structure, which is often a form of illegal lottery or pyramid scheme.
The Act bans such schemes and provides measures to enforce penalties for violations, including imprisonment and fines for individuals or entities that promote or participate in these fraudulent schemes. The primary goal is to prevent financial exploitation through deceptive practices that mislead people into participating in a circular financial arrangement that benefits only a few.
