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Class 12 Entrepreneurship CH-6 Resource Mobilization
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- 3. Overview IFCI Ltd (IFCI)was set up as a Statutory Corporation (“The Industrial Finance Corporation of India”) in 1948 for providing medium and long term finance to industry.. In 1993, after repeal of the Industrial Finance Corporation Act, IFCI became a Public Limited Company, registered under the Companies Act, 1956. IFCI is also registered with the Reserve Bank of India (RBI) as a Systemically Important Non- Deposit taking Non-Banking Finance Company (NBFC-ND-SI) and is also a notified Public Financial Institution under Section 2(72) of the Companies Act, 2013.
- 4. Main Functions OfIFCI: ● First, the main function of the IFCI is to provide medium and long-term loans and advances to industrial and manufacturing concerns. It looks into a few factors before granting any loans. They study the importance of the industry in our national economy, the overall cost of the project, and finally the quality of the product and the management of the company. If the above factors have satisfactory results the IFCI will grant the loan. ● The Industrial Finance Corporation of India can also subscribe to the debentures that these companies issue in the market. ● The IFCI also provides guarantees to the loans taken by such industrial companies.
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- 7. Overview IFCI Ltd (IFCI)was set up as a Statutory Corporation (“The Industrial Finance Corporation of India”) in 1948 for providing medium and long term finance to industry.. In 1993, after repeal of the Industrial Finance Corporation Act, IFCI became a Public Limited Company, registered under the Companies Act, 1956. IFCI is also registered with the Reserve Bank of India (RBI) as a Systemically Important Non- Deposit taking Non-Banking Finance Company (NBFC-ND-SI) and is also a notified Public Financial Institution under Section 2(72) of the Companies Act, 2013.
- 8. Main Functions OfIFCI: ● First, the main function of the IFCI is to provide medium and long-term loans and advances to industrial and manufacturing concerns. It looks into a few factors before granting any loans. They study the importance of the industry in our national economy, the overall cost of the project, and finally the quality of the product and the management of the company. If the above factors have satisfactory results the IFCI will grant the loan. ● The Industrial Finance Corporation of India can also subscribe to the debentures that these companies issue in the market. ● The IFCI also provides guarantees to the loans taken by such industrial companies.
- 9. ● When acompany is issuing shares or debentures the Industrial Finance Corporation of India can choose to underwrite such securities. ● It also guarantees deferred payments in case of loans taken from foreign banks in foreign currency. ● There is a special department the Merchant Banking & Allied Services Department. They look after matters such as capital restructuring, mergers, amalgamations, loan syndication, etc. ● It the process of promoting industrialization the Industrial Finance Corporation of India has also promoted three subsidiaries of its own, namely the IFCI Financial Services Ltd, IFCI Insurance Services Ltd and I-Fin. It looks after the functioning and regulation of these three companies.
- 10. ICICI-Industrial Credit andInvestment Corporation of India
- 11. Industrial Credit andInvestment Corporation of India (ICICI) was established in 1955 as public limited company under Indian Company Act, for developing medium and small industries of private sector. Initially its equity capital was owned by companies, institutions and individuals but at present its equity capital has been owned by public sector institutions like—Banks, LIC, ect., and its associate companies. In March 2002, the ICICI was merger with the ICICI Bank and created a first universal bank in India. With this merger, ICICI does not exist any more as a development financial institution.
- 12. Objectives Of ICICI: Theimportant objectives of the ICICI are as follows: (i) To provide loans to industrial projects in private sector ii) To stimulate the promotion of new industries. (iii) To assist the expansion and modernization of existing industries. (iv) To provide Technical and managerial aid to increase production.
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- 14. Overview: The State FinanceCorporations (SFCs) are an integral part of institutional finance structure of a country. Where SEC promotes small and medium industries of the states. Besides, SFC help in ensuring balanced regional development, higher investment, more employment generation and broad ownership of various industries.
- 15. The various importantfunctions of State Finance Corporations are: (i) The SFCs provides loans mainly for the acquisition of fixed assets like land, building, plant, and machinery. (ii) The SFCs help financial assistance to industrial units whose paid-up capital and reserves do not exceed Rs. 3 crore (or such higher limit up to Rs. 30 crores as may be notified by the central government). (iii) The SFCs underwrite new stocks, shares, debentures etc., of industrial units. (iv) The SFCs grant guarantee loans raised in the capital market by scheduled banks, industrial concerns, and state co-operative banks to be repayable within 20 years. Functions Of SFCs:
- 17. ● When acompany is issuing shares or debentures the Industrial Finance Corporation of India can choose to underwrite such securities. ● It also guarantees deferred payments in case of loans taken from foreign banks in foreign currency. ● There is a special department the Merchant Banking & Allied Services Department. They look after matters such as capital restructuring, mergers, amalgamations, loan syndication, etc. ● It the process of promoting industrialization the Industrial Finance Corporation of India has also promoted three subsidiaries of its own, namely the IFCI Financial Services Ltd, IFCI Insurance Services Ltd and I-Fin. It looks after the functioning and regulation of these three companies.
- 18. ICICI-Industrial Credit andInvestment Corporation of India
- 19. Industrial Credit andInvestment Corporation of India (ICICI) was established in 1955 as public limited company under Indian Company Act, for developing medium and small industries of private sector. Initially its equity capital was owned by companies, institutions and individuals but at present its equity capital has been owned by public sector institutions like—Banks, LIC, ect., and its associate companies. In March 2002, the ICICI was merger with the ICICI Bank and created a first universal bank in India. With this merger, ICICI does not exist any more as a development financial institution.
- 20. Objectives Of ICICI: Theimportant objectives of the ICICI are as follows: (i) To provide loans to industrial projects in private sector ii) To stimulate the promotion of new industries. (iii) To assist the expansion and modernization of existing industries. (iv) To provide Technical and managerial aid to increase production.
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- 22. Overview: The State FinanceCorporations (SFCs) are an integral part of institutional finance structure of a country. Where SEC promotes small and medium industries of the states. Besides, SFC help in ensuring balanced regional development, higher investment, more employment generation and broad ownership of various industries.
- 23. The various importantfunctions of State Finance Corporations are: (i) The SFCs provides loans mainly for the acquisition of fixed assets like land, building, plant, and machinery. (ii) The SFCs help financial assistance to industrial units whose paid-up capital and reserves do not exceed Rs. 3 crore (or such higher limit up to Rs. 30 crores as may be notified by the central government). (iii) The SFCs underwrite new stocks, shares, debentures etc., of industrial units. (iv) The SFCs grant guarantee loans raised in the capital market by scheduled banks, industrial concerns, and state co-operative banks to be repayable within 20 years. Functions Of SFCs: