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lexplain in detail IDBI and ICICI with
function and objectives.
ICICI
The creation of Industrial Credit and
Investment Corporation of India (ICICI) is
another milestone in the growth of the Indian
Capital Market. It was incorporated in the
year 1955, as a company registered under
the Companies Act. The ICICI was
incorporated to finance small scale and
medium industries in the private sector.
Objectives ICICI
1. To assist in creation, growth and
modernization of business enterprises in the
non-public sector.
2. To encourage and promote the
involvement of internal and external capital
sources, in such enterprises.
3. To motivate pvt ownership of industrial
investment and to promote and assist in the
expansion of markets.
4. To provide equipment finance.
5. To provide finance for rehabilitation of
industrial units. Function
1. Providing finance in the form of long-term
or medium term loans or equity participation.
2. Sponsoring and underwriting new issues
of shares and other securities,
3. Guaranteeing loans from other private
investment sources.
4. Making funds available for reinvestment
by revolving investment as rapidly as
possible.
5. Providing project advisory services i.e.
offering advice.
IDBI
Industrial Development Bank of India (IDBI)
established under Industrial Development
Bank of India Act, 1964, is the principal
financial institution for providing credit and
other facilities for developing industries and
assisting development institutions. Objectives of IDBI
* The main objectives of IDBI is to serve as
the apex institution for term finance for
industry in India. Its objectives include:
* Co-ordination, regulation and supervision of
the working of other financial institutions
such as IFCI ICICI, UTI, LIC, Commercial
Banks and SFCs.* Supplementing the
resources of other financial institutions and
there by widening the scope of their
assistance.* Planning, promotion and
development of key industries and
diversification of industrial growth.» Devising
and enforcing a system of industrial growth
that conforms to national priorities. Functions of IDBI
(i) To provide financial assistance to
industrial enterprises.(ii) To promote
institutions engaged in industrial
development.(iii) To provide technical and
administrative assistance for promotion
management or expansion of industry.(iv) To
undertake market and investment research
and surveys in connection with development
of industry.
Venture capital
Venture Capital refers to the finance
provided by Venture Capitalists, who invest
in relatively new, high growth companies or
startups that have a potential to grow and
develop into highly profitable ventures. It has
high-risk and high-return characteristics.
Therefore, it acts as an important source of
finance for entrepreneurs with new ideas. Objectives
1)It creates an environment suitable for
knowledge and technology-based
enterprises.
2)It helps to boost scientific,
technology and knowledge-based ideas
into a powerful engine of economic
growth and wealth creation ina
suitable manner.
3)It aims to play a catalytic role to India
on the world map as a success story.
4)Process Of Venture Capital Financing
The Venture Capital Funding process
gets completed in six different stages: