Sfc Idbi And Sidbi

State Finance Corporation

IFCI – Deals with – Large public limited companies and co-operative societies which are engaged in manufacturing, mining, guiding generation and distribution of electricity

• SFCS – Assist small and medium enterprises • SFCs Act of 1951 • Authorized capital Rs.50 Lakhs to Rs.5 Cr. Contributed by – – – – –

State Government Reserve Bank of India (RBI) Scheduled Banks Co-op. Banks Insurance Companies

• Functions: – – – – –

Guarantees loan – repayable in 20 yrs Underwriting Grants loans and advances Maximum 20 yrs repayment Subscribes debentures floated by industrial concerns

• SFCs can not subscribe to shares/stocks • SFC can grant maximum of Rs.10 crores – 20 years 1980-81 370 Cr 250 Cr

2003-04 1130 Cr Sanctioned 890 Cr Disbursed

IDBI Set up in 1947 • Long term finance to industries, IFCI, SFC, ICICI and Refinance Corporation of India

• Functions I. Direct Assistance: – – – – – –

Project loans Underwriting Direct subscription to secutiries Soft loans Technical refund loans and equipment finance loan Guarantees loan raised from financial institution

IDBI can also accept discount or rediscount bona fide commercial bills or promissory notes of Industrial concern II.Indirect Assistance: – Refinance term loan of 3 to 10 years given by scheduled banks Co-op. Banks and IFCI and SFCs – Refinance by port credit – Subscribes stocks, shares, Debentures of IFCI, SFCs

III.Special Assistance: For industrial concerns who do not get loans in normal course. IV. Foreign Currency requirements Assistance to Backward Areas to Small Scale units on softer term Refinance facility by IDBI Loans SFCs, IFCI, Participates in refinancing

Assistance to Small Scale Sectors Transport operators Small industries Development Bank of India (SIDB) started in 1989 – subsidiary of IDBI Loans Sanctioned Disbursed

1980-81 1280 1010

2003-04 5830 4410

Small Industries Development Bank of India (SIDBI) April 1990 Authorized Capital Rs.250 Cr Subsidiary of IDBI Principle financial institution for promotion, financing and development of small scale industries in the country more than 870 institutions eligible for loans from IDBI

FUNCTIONS: – Refinance facility of loans and advances extended by the primary heading institution to small scale units. – Discounts and rediscounts bills – Extends seed capital/soft loans assistance under National equity fund, Mahila Udyam Nidhi. – Divert and refinance assistance for financing of experts of Small Scale Sectors

– Services like leasing, factoring Sector – Financial support to State Small Development Corporation for leasing, hire purchase and supports • • • •

Large flow of funds of Small Sector Marketing Assistance Employment Generation Checking to urban areas

in Small Industries providing marketing

PROGRESS: – Single Window Scheme • • •

Rehabilitation Modernization Tech. upgradation

– Automatic Refinance Scheme upto Rs.50 Lakhs – Equipment financing assistance to well run Small Units for technology upgradation/modernization

– Helping workers to by looms – Venture capital assistance Loans Sanctioned Disbursed

1990-91 2410 Cr 1840 Cr

2003-04 8220 Cr 4410 Cr