Industrial Development Bank of India - Role and Meaning of IDBI Bank
The Full Form of IDBI is the Industrial Development Bank of India. The bank head office is situated in Mumbai and operates through 5 regional chapters in Delhi, Bangalore, Mumbai, Kolkata, Delhi, and Chennai.
For over 40 years, IDBI bank has played a pivotal role in nation-building. It’s the 10th largest bank in the world due to its structure and robust working capital. IDBI bank has a strong presence in the agricultural sector, with a highly competitive and dedicated workforce directing the daily operations.
Importance of IDBI Bank for India
For the smooth running of the economies the role of banks is very crucial. Banks are the financial institutions that provide credit for the entity in need of money and also acts as the manager of the savings of the people who have deposited their earned money in that bank. The essential role that a bank plays in an economy or society is making available capital for long term investments that is not possible by any individual to arrange. Thus it would not be wrong to say that Banks are inevitable Institutions for an economy to develop.
In our country the banking history started with the establishment of three banks named Imperial Bank of India during the British era. It was later renamed as State bank of India. As it was previously infamous only for providing facilities to big merchants and British people, after independence the Government of India took responsibility for establishing more banks for the general masses in the actual need of money. In later periods it was found that there is a dire need of providing capital sums for establishing bigger businesses and institutions.
With this view, the Government of India started a development financial institution in 1964. An act was passed under the name of Industrial Development Bank of India (IDBI) Act, 1964. After 40 years in 2004 it was transformed into a full functioning bank.
After years of service as a financial institution and later as a bank it has become the 10th largest bank in the world. It is a moment of pride for all of us for having a bank that is still true to its mission and is performing on the desired line and interest of the country.
Conclusion
There are different kinds of banks with different objectives and functions. Some banks are established and managed by the government of a nation. And there are some banks that are run by private entities. Students can register at Vedantu to know more on banks and their functions.
FAQs on IDBI Full Form
1. Is IDBI a Nationalized Bank?
Although IDBI is a public sector bank it is not nationalized. It was set up in 1964 as a wholly owned subsidiary of RBI. Later on, the shares were transferred to the Government of Indian in 1976.
2. What do You Know About IDBI Bank?
IDBI abbreviation means the Industrial Development Bank of India. It was established in 1964 by a separate banking act and was made a bank in 2004. The main objectives of IDBI are to advance credits to the agricultural sector and promote industrial growth in India.
3. Has the IDBI Bank Failed?
IDBI bank has seen his assets falling by around 7% during the March-June fiscal quarter. The losses have caused the capital ratios to also slip abnormally. This means that the bank is unable to check its bad loans.
4. What are the objectives of IDBI bank?
The foremost objective of the IDBI bank is to provide long term credits for the development of Industries in the country. For the upkeep of the National priorities of the country it takes responsibility for deployment of capital resources of the country through proper planning. Various other development financial institutions also are regulated by IDBI. Some other development financial institutions are ICICI, IF I, UTI, LIC, and Small financial corporations. These banks are regulated by IDBI and work according to the regulations formulated by IDBI.
2. What are the functions of IDBI bank?
As any other bank it grants loans and advances to various other banks under its regulation. The long term loans provided by the IDBI bank to scheduled banks and state cooperative banks are repayable within 15 years. The small and big merchant banks also get advisory and consultancy services from IDBI bank. Also various industrial units get their shares underwritten at the IDBI bank. Overall it performs the function of developing various industries of the country by proper planning and promotion.
6. What are the various products available to beneficiaries at IDBI bank?
IDBI is a government regulated bank with a major objective of regulating other private and small government development banks operating inside India. But after it was restructured recently it now also provides many products for the benefit of customers with smaller deposits. IDBi has now the facility of opening a savings account, current accounts. It also issues debit and credit cards. The facility of fixed deposit and locker are also available at various branches of the IDBI bank. It also provides banking services to the corporate sector and NRI banking sector.
7. What is IDBI Agriculture Banking and how does it help in the industrial development of the country?
IDBI Bank also provides various products for the development of the agriculture sector of the country. It is often observed that to perform agriculture one needs to develop the land and other infrastructure for establishing a long-term crop production land unit. These developments require investment which is much higher than the term loans available per cropping season. So it would surely benefit the farmer to get credit for developing its land that will increase its productivity for many years to come.
8. Where can I learn about different types of banks in India and their functions?
Every responsible citizen of India as well students must learn about the banking system and its importance in the economy of the country. As there are various types of banks working for different sectors of the economy it is essential to have knowledge about all the banks presently operating in India. Vedantu has prepared and compiled all the information regarding all the banks and their functions in a well structured format. Any student can get access to these study materials by registering themselves on the website.