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AKSHATA BHOSALE (54)

ARCHANA HINGAD (8)

PRIYA KUMAR (16)VINITA SHETTY (44)

SONALI ACHARI (1)

GROUP MEMBERS

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The foreign rulers in India did not takemuch interest in the industrialdevelopment of the country.

The setting of up industrial financinginstitutions was made in 1931.

In 1948 the 1st development bank i.e.

Industrial Finance Corporation of India(IFCI) was established.

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Development banks are governmentsponsored financial institutions.

These institutions played a crucial rolein the rapid industrialization process .

High arrear ratios, poor cost-benefit.

Evaluations, and widespread evidence ofmismanagement and corruption have.

Undoubtedly contributed to the currentdisenchantment.

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The term development banking is used toinclude both proper & finance corporations. The difference is that the former areprimarily concerned with long-term loan,capital, while the latter deals with equity

capital & assume responsibility forfostering & managing individual companies. The share of commercial banks in the

share capital of these institutions is aboutone quarter and their contribution to thetotal value of bonds issued by them is 80%.

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Financial institutions dedicated tofund new and upcoming businesses

and economic development projectsby providing equity capital and/orloan capital.

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Industrial development bank of India (IDBI)

National Bank for Agriculture and RuralDevelopment (NABARD)

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INDUSTRIAL DEVELOPMENTBANK OF INDIA : The Industrial Development Bankof India (IDBI) was established on1 July 1964 .

In 16 February 1976, theownership of IDBI wastransferred to the Government ofIndia.

Narasimam committee

recommends that IDBI should giveup its direct financing functionsand concentrate only in

promotional and refinancing role.

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This committee is the first torecommended the concept of universalbanking.

IDBI Bank, with which the parent

IDBI was merged, was a new generationBank.

IDBIs transformation into acommercial bank would provide a gatewayto low-cost deposits like Current and

Savings Bank Deposits.

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National Bank forAgriculture and RuralDevelopment (NABARD): NABARD was established byShivaraman Committee, on 12July 1982.

It is an apex development bankin India having headquartersbased in Mumbai .

NABARD looks after thedevelopment of the cottageindustry, small industry andvillage industry, and other ruralindustries.

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DEVELOPMENT Financial institutions

dedicated to fund

new and upcomingbusinesses &economicdevelopment projectsby providing equitycapital and/or loancapital.

It is an institutionprimarily engaged in

the provision of loan,finance, to aparticular categoryof business units by

guaranteeing orgranting long termloans.

FINANCIALINSTITUTIONS

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Development bank isestablished to perform

both banking andfinancing &development activities.

A development bank isconceived as aninstrument of statepolicy, the world totake into consideration

public interest in theirfinancing operations.

Financial corporation issimply established to

perform banking andfinancial activity.

A financial corporationis not necessary to doso an is simply to

finance industrialenterprise.

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Development banking isdesigned to provide alltypes of financial, includingrisk, capital.

Development banks ensureeconomic viability ofprojects.

Development bank may be

designed to play bothquantitative and qualitativerole, industrial financingand development work.

Financial corporation isconcerned with providingsimply loan capital,underwriting of shares &

debentures.

Financial corporation workson orthodox bankingbusiness principle such assecurity of loan, margin ofloan i.e its lending policy isrestrictive.

Financial corporation wasstill recently concerned

only with the 1st

1 and notthe 2nd 1.

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The concept of development banking rose onlyafter 2nd world war.

The IBRD was set up in 1945 as a worldwideinstitution for development and reconstruction.

The 1st development bank in India incorporated

immediately after independence in 1948 under theIndustrial Finance Corporation Act.

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The roots of the national system were inthe State Bank of India Actof 1955.

The financial institutions in India were set upunder the strong control of both central andstate Governments.

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