FINANCIAL INSTITUTION IN INDIARanika Chaudhary

A financial agencies that provide medium and long-term financial assistance and engaged in promotion and development of industry, agriculture and other key sectors.

Ex: International Bank for reconstruction and Development (IBRD) also known as World Bank & International Monetary Fund (IMF)

DEVELOPMENT FINANCIAL INSTITUTIONS

INTRODUCTION

Industrial finance is a very complicated problem. It is of vital importance as development of any country depends on industrial development of that country ‘s economy.

Why there is need of finance1) Long term2) Medium term3) Short term

CONTINUE….

Long term capital is also known as block capital or fixed capital. it is needed to acquire

-fixed and permanent assets Medium term capital is required for repairs,

replacements, maintenance of machines and building etc.

Short term capital is needed for purchase of raw material , and to meet day to day expenses

TYPES OF FINANCIAL INSTITUTIONS IN INDIA

Term lending Refinance institutions Investment institutions State level institutions

TERM LENDING

A term loan is a monetary loan that is repaid in regular payments over a set period of time. Term loans usually last between one and ten years, but may last as long as 30 years in some cases. A term loan usually involves an unfixed interest rate that will add additional balance to be repaid.

IFCI IDBI ICICI EXIM

IFCI (INDUSTRIAL FINANCE CORPORATION OF INDIA)

It was established in 1948 First development bank of India Objective was to make medium and

long term credits more readily available Management BOD total 12 members(4 by idbi,2 by

center govt, 6 by shareholders) -full time chairperson

CONTINUE….

Resources of IFCI-ownership capital-Issue of shares and bonds-borrowing from RBI,IDBI AND CENTER

GOVT-accepting deposits from public, state

govt and local authorities

FINANCIAL ASSISTANCE BY IFCI/IDBI

Purpose sanction(crores) IDBINew projects 15919.6 67498

Expansion /acquisition 6649.2 50627Rehabilitation 115.7 1415Modernization 5459.7 12976Working capital 837

5138

IDBI (INDUSTRIAL DEVE. BANK OF INDIA) Set up in 1964 It was fully owned subsidiary of RBI but

in 1976 delinked from RBI and made as autonomous body of GOI

H.O in Mumbai 11 branch offices It is managed by a chairman and MD

appointed by central govt, a deputy governor nominated of RBI, 20 other directors.

CONTINUE..

With effect from 1 oct,2004 it has renamed as IDBIL. It has been accepted as a deemed banking co under banking regulation act. The govt holds the majority (58.47%) shares of IDBI LTD.

During last 40 years IDBI has given a qualitative dimension to the process of industrial development of the country.

I.C.I.C.I. (INDUSTRIAL CREDIT & INVESTMENT

CORPORATION OF INDIA) Established in 1955 As a public ltd co,

at the initiative of world bank Authorized capital of 60 crores and

issued capital 22 crores The objectives of icici are to encourage

establishment of new industries, to help in expansion and modernization, technical and managerial aid to increase production and employment.

CONTINUE…

In October 2001 .BOD Approved ICICI LTD AND ICICI BANK LTD. With effect from MAY 2002 IT IS SIMPLY ICICI bank .

ICICI is now the largest bank with total assets of more than 3000 billions

More than 700 branches and over 2200 ATM spread all over the country

It mainly deals in Retail banking, wholesale banking, project

finance, international business and special assets mgt

CONTINUE…

Icici is known for its many firsts. -it was first Indian co to listed in New york stock

exchange. Foreign financial investor own around 38% shares . Technology, strategy, low cost branches innovations

are key reasons of icici success. They are the first to introduce mobile banking, on

line financial information, portals to allow accounts and information on line.

It was the first to introduce e-commerce. It has the largest no of call centers.

EXIM

Established on1st JAN,1982. Authorized capital 1000 crores and paid

up is 650 crores. Exim bank came into existence when

international finance division of idbi was transferred to exim bank in 1982.

Exim started its working from march 1982 The issued capital is wholly subscribed by

center govt

CONTINUE…

The main objective of exim is to provide financial assistance to exporters and importers. It has to coordinate the working of those institutions which can promote international trade.

Management is MD+17 other directors representing govt,RBI,ECGC,public sector banks

Resources of EXIM -GOI -RBI -any organization approved by GOI TYPES OF ASSISTANCE -fund based -non fund based

ASSITANCE BY EXIM

Fund based Pre shipment credit Foreign currency Post shipment credit Deemed exports Loans to commercial

banks for bills discounting

Finance for consultancy and technology

Non fund based Guarantees

REFINANCING INSTITUITIONS

Are those which do not give finance directly but they create such structure by which the funds are allocated up to the minimum level.

N.A.B.A.R.D. S.I.D.B.I. N.H.B

NABARD-NATIONAL BANK FOR AGRICULTURE AND RURAL DEVELOPMENT

Started functioning from 1july 1982 Set up with an initial capital of 100 crores, now it

is 2000 crores fully subscribed by GOI AND RBI. H.O IN Mumbai, with 28 regional and 391 district

offices It is an apex orga for policies, planning and

operations of agriculture ,ssi ,handicraft and village industries

It mainly deals in three types of functions -credit ,developmental ,regulatory functions

CONTINUE……

Funds created by NABARD -rural infrastructural deve fund 28749

crores -R&d fund -Soft loan assistance fund -Credit and financial services fund

SIDBI

Set up in oct 1989 Wholly owned subsidiary of IDBI It is the principal financial institution for

promotion ,financing and deve of small scale industries

In sep 2000 IDBI transferred 51% in favor of banks and other institutions in the first phase.

1) Its Functions are:A) SSI units for new/ expansion/

diversification/ modernization projects.B) Marketing development projects which

expand the domestic and international marketability of SSI products.

C) Existing well run SSI units and ancillaries/ subcontracting units/ vendor units for modernization and technology up gradation.

D) Infrastructure development agencies for developing industrial areas.

NHB-NATIONAL HOUSING BANK

Set up in July 1988 A principal agency to promote housing

finance Wholly owned subsidiary of RBI Registered With capital of 350 crore

which can be increased to 2000 crores. The board is authorized to issue increased capital to RBI, center govt.

INVESTMENT INSTITUITIONS

Are those who invest the money collected in further securities and investments outside .LIKE

LIC GIC

LIC

Set up in 1956 Lic was formed by nationalizing 245 life

insurance companies The main aim was to1. spread insurance2. Mobilize savings3. Investing funds4. Act as trustees

CONTINUE…..

-promoting a sense of pride and job satisfaction among agents and employees

Diversification by LIC-LIC HOUSING FINANCE-LIC MUTUAL FUNDS-Jeevan bima sahyog assets mgt

co(JBSAMC)-LIC International EC

VISION & MISSION

Mission "Explore and enhance the quality of life of people through financial security by providing products and services of aspired attributes with competitive returns, and by rendering resources for economic development." 

Vision"A trans-nationally competitive financial conglomerate of significance to societies and Pride of India."

TYPES OF INSURANCE SCHEMES

Whole life schemes Endowment policies Money back policy Plans for children Medical benefits linked insurance Plans to cover housing loan Joint life plans Group schemes Pension plans Social security schemes

G.I.C.

 It was incorporated on 22 November 1972. The Government of India (GOI), through

Nationalisation took over the shares of 55 Indian insurance companies and the undertakings of 52 insurers carrying on general insurance business.

Main objective:- GIC was formed for the purpose of

superintending, controlling and carrying on the business of general insurance.

VISION & MISSION

Vision “To be a leading global reinsurance and risk solution provider”

Mission:- Building long-term mutually beneficial relationship with

business partners Practicing fair business ethics and values Applying “state-of-art” technology, processes including

enterprise risk management and innovative solutions. Developing and retaining highly motivated professional team

of employees Enhancing profitability and financial strength befitting the

global position

STATE LEVEL INSTITUTION