Role of Financial Institutions – a Case Study over Ifci

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ROLE OF FINANCIAL INSTITUTIONS

A CASE STUDY OVER IFCI

Rohini Gupta*

Abstract

The paper analyses the real effect of the role of the IFCI (Industrial Finance Corporation of India) as a financial institution in Indian market. Here the whole data used for this case study is of secondary data. And this case study explains the need of the establishment of IFCI, how it is helping business and other sectors of our economy. The major findings in data form are the functions of IFCI and its promotional activities. The research paper Provides the information about the financial help provide by the IFCI Industry wise which was 44169.2 crores , product wise for last 5 years. And its financial performance for 2007-2008 and 2009-10 also studied. This research paper is a case study paper of IFCI.

Introduction

In, India various financial institutions were set up after independence only. The government of India has taken steps to set up institutions. Which assist various sectors of the economy...? At present the country has 12 institutions as the national level and 46 at the state level. At the time of the independence there was need for the specialized institutes for the meeting the long term finance of industries. The capital market was not properly developed in India. After Second World War there was a need for renovation and restructuring of industry. Then the Government of India cam forward to set up the Industrial Finance corporation of India (IFCI) in July 1948 under a special Act. Since July 1, 1993 the corporation has been converted into a company and it has been given the status of a ltd. Company with the name Industrial Finance corporations Of India Ltd. Objective of study:-

The basic objective of this paper is to find out the real contribution in data form of IFCI in the growth and development of our economy. •And the second one is to get that weather this rate of help to economy is increasing day by day or with which pace. •To find out the role of IFCI in Indian financial system.

RESEARCH METHODOLOGY

Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. In it we study the various steps that are generally adopted by a researcher in studying his research problem along with logic behind him. Why a research study has been undertaken, how a research problem has been defined, in what way and why the hypothesis has been formulated, what data have been collected and what particular method has been adopted, why particular technique of analyzing data has been used.

Data sources: - the sources of data are properly secondary data sources. Through magazines, business journals and literatures at is collected.

Management of IFCI

The corporation has 13 members Board of Directors, including Chairman. The Chairman's appointed by Government of India after consulting Industrial Development Bank of India. He works on a whole time basis and has tenure of 3 years. Out of the 12 directors, four are nominated by the IDBI, two by scheduled banks, two by co-operative banks and two by other financial institutions like insurance companies, investment trusts, etc. Abnormally nominates three outside persons as directors, who are experts in the fields of industry, labour and economics, the fourth nominee is the Central Manager of IDBI. The Board meets once in a month. It frames policies by keeping in view the interests of industry, commerce and general public. The Board acts as per the instructions received from the government and IDBI. The Central Government reserves the power up to the Board and appoints a new one in its place.

Financial resources of IFCI

Share capital:- around 1068 crores capital is there with the IFCI

Bonds and Debentures: - a figure of Rs. 57.69 crores 1971 and rose rs. 15366.5 crores as on 31 march 2008

Borrowings: - it borrows from government and IDBI...
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