IDFC, IFCI and IDBI

Unit X: Entrepreneurship Development

Overview:
IDFC is a private sector financial institution in India that focuses on infrastructure financing. It was established in 1997 and has played a key role in the development of infrastructure projects in the country, such as roads, power, telecommunications, and transportation.
Key Functions:
IDFC primarily provides financial products such as:
- Project financing for infrastructure projects.
- Investment banking services, including advisory and capital market services.
- Asset management and private equity funding for infrastructure projects.
Status:
Although originally set up as a public-private partnership, IDFC later became a private sector entity. It has now diversified into providing banking services through its subsidiary, IDFC Bank (now IDFC FIRST Bank).

Overview:
The Industrial Finance Corporation of India (IFCI) is one of India’s oldest development financial institutions, established in 1948. It was created to provide long-term financing to industries in India, primarily large industries.
Key Functions:
IFCI focuses on:
- Providing long-term finance to various sectors, particularly large-scale industries.
- Refinancing loans to industries.
- Offering financial products and services for corporate financing, project finance, and infrastructure development.
Status:
IFCI was set up by the Government of India and operated as a public-sector institution. However, it has been partially privatized over time and is now listed on the stock exchanges. It continues to focus on the financing of large industries, rather than small-scale or MSMEs.

Overview:
The Industrial Development Bank of India (IDBI) was established in 1964 by the Government of India to provide long-term financing for the development of industries in India. Initially, IDBI was a development financial institution (DFI), but it later converted into a commercial bank.
Key Functions:
IDBI provided long-term credit to industries and supported infrastructure projects. Its functions include:
- Term financing to large and medium-sized industrial projects.
- Project appraisal and refinancing services.
- Assisting in the development of the capital market and providing working capital loans.
Status:
Over the years, IDBI transformed into a commercial bank (IDBI Bank), offering a range of banking products, including retail banking, corporate banking, and investment banking. IDBI now operates like any other commercial bank, serving a wider clientele rather than focusing specifically on industries.