What is Development Bank? Discuss the functions of Development Bank.
Contents
Meaning and Definitions of Development Bank
Development banks are financial institutions which provide medium and long term finance. They encourage entrepreneurship organisational effectiveness and technical know-how. Various scholars have defined development banks as under –
According to Diamond William, “Development bank is an institution to promote and finance enterprises in the private sector.”
According to C. S. Vanket Rav, “The term development bank’ imbraces a variety for financial institutions which provide medium and long term finance to industry or agriculture and extend technical or managerial advice needed to formulate and improve projects.”
According to Boskey Shirley, “Development banks are institutions,. public or private, which have, as one of their principal functions, the making of medium or long term investments in industrial projects.”
Development banks are promoted and managed by the government or private groups.
Functions of Development Banks
Following are the functions of development banks –
- Development banks provide medium and long term finance to industries.
- They promote entrepreneurship and organisational effectiveness.
- Development banks provide advisory and entrepreneurial services.
- To promote and develop small-scale industries in India.
- To finance the development of the housing sector in India.
- To facilitate the development of large-scale industries in India.
- To help the development of agricultural sector and rural India.
- To enhance the foreign trade of India.
- To help to review (cure) sick industrial units.
- To encourage the development of Indian entrepreneurs.
- To promote economic activities in backward regions of the country.
- To contribute in the growth of capital markets.
Related Link
- Describe the various types of money
- Dynamic Functions of Money
- Evils or Demerits of Money
- Importance and significance of money in Modern Economy
- Approaches regarding Definitions of Money and its Function
- Money: Meaning, Definitions and features of Money
IMPORTANT LINK
- What is the Exchange Rate System in India?
- Evolution of foreign exchange market in India
- Meaning and importance of export finance.
- Role of Export-Import Bank in Financing India’s Foreign Trade
- How Commercial banks Export Finance to Overseas Importers?
- Explain packing credit in detail?
- What is Post-shipment credit?
- What is Pre-shipment or packing credit?
- Explain Export Credit in India?
- Institutions Providing Finance and Credit Facility for Foreign Trade
- What is Risk Analysis?
- Explain Political risks in detail? and its Types
- What are the types of Risks. Explain in detail?
- Meaning and Types of commercial risks
- How can we minimize foreign trade risks?
- What are Arbitrage operations?
- Difference between Spot Market and Forward Market
- What is spot exchange?
- Agency agreement: Meaning, Features and Advantages
- Functions of Foreign Exchange markets
- structure of Foreign exchange markets
Disclaimer