About:
- SFC was established in 1951 after three years of the establishment of IFCI.
- SFCs were set-up in various states as regional institutions to cope with the requirements of medium and small scales industries.
- The first SFC was in Punjab, set up in 1953.
- The authorised capital shall not be less than fifty lakhs of rupees or exceed five hundred crores of rupees (as per the State Financial Corporations Act, 1951). • The public can hold can hold 25% of the share and the rest is held by State.
- These corporations can sell bonds and debentures and accept term deposits from public.
Functions: Some important functions of the SFCs are –
- to guarantee loans raised by industrial units to be repaid within 20 years,
- to grant loans and advances repayable within 20 years,
- to subscribe, shares bonds and debentures of industrial concerns.