Full Form of IDBI

The full form of IDBI is the Industrial Development Bank of India. It is a Development Financial Institution constituted in 1964, as a wholly-owned subsidiary of the Reserve bank of India, for providing financial aid to industries and assisting the development institutions (like NSE, NSDSL, SIDBI, etc.) in India post-Independence.

It was constituted as a Development Financial Institution in 1964 by a parliamentary Act. In 1976, the Reserve Bank of India transferred the ownership of IDBI to India's Government, and it became the prominent financial institution for promoting industrial development in India. It also played a key role in developing national importance institutions like the National Stock Exchange, National Securities Depository Services Limited, Stock Holding Corporation of India, Small Industrial Development Bank of India, Exim Bank, and Entrepreneurship development institute of India.

• The Industrial Development Bank of India (IDBI) was established in 1964 as a subsidiary of the Reserve Bank of India. Its core objective was to support the post-independence establishment of crucial institutions such as NSDL, NSE, and SIDBI in India.
• Originally a development bank, IDBI underwent a transition into a commercial bank in 2003, subsequently rebranding as IDBI Ltd in 2004. 
• With over 50 years of lending expertise, IDBI Bank leverages advanced technology to deliver reliable and innovative banking solutions to its customers.

Following are the main functions of IDBI Bank -

• Providing financial support for the industries: The long-term financial assistance, say for 25 years.
• Undertake market study and research to find the investment opportunity related to industrial development.
• Promoting institutions working for industrial development.
• Providing technical and administrative assistance for the promotion and expansion of industries.
• Coordinating and supervising the activities of the institutions working in the financing sector.
• Facilitate balanced industrial development across India.

In 2003, IDBI converted to a commercial bank under the Industrial Development Bank (Transfer of undertaking and Repeal) Act, 2003. The bank gained its new status as a part of reforms in the financial sector. Later on, in 2004, it was incorporated as a scheduled bank. The bank was renamed IDBI Ltd.

In January 2019, the Reserve Bank of India reclassified IDBI bank as a private sector bank for regulatory purposes after the 51% stake acquisition by the Life Insurance Corporation of India. Now the government holds a 46.46% stake in the bank.

The bank's headquarters is located in Mumbai, with five regional offices.  Apart from that, the bank has branches in different locations. The organization and management consist of Chairman and Managing Director appointed by India's government and 20 other directors nominated by the government. The board has formed an executive committee of 10 members, including the chairman and Managing director, responsible for approval of financial assistance.

Following are the subsidiaries of IDBI Bank -

• IDBI Capital Market Services Ltd. (ICMS)
• IDBI Asset Management Ltd. (IAML)
• IDBI MF Trustee Company Ltd. (IMTCL)
• IDBI Federal Life Insurance Company Ltd. (IDBI Federal)
• IDBI Intech Ltd. (IIL)

ICMS, IAML, IMTCL, and IIL are the wholly-owned subsidiaries of IDBI Bank. At the same time, IDBI federal is a joint venture of IDBI Bank, Federal Bank, and Ageas Insurance International. IDBI has a 48% stake, and other companies have 26% each.

IDBI provides various products and services to its customers, like every other bank. The most important factor is that the bank is also providing products and services to the Agriculture sector. Personal, Corporate, MSME, Agri, and NRI Banking provide the products and services.

#1 - Personal Banking

Under this category, the bank provides normal banking products like preferred banking, loans, fixed deposit and lockers, cards, 24-hour banking, Flexi current account, etc. apart from that, the bank provides:

• Kutumb-Family banking
• Pradhan Mantri Social Security Scheme
• Trusteeship through ITCL
• Sukanya Samriddhi Account

#2 - Corporate Banking

The main product of this banking is financial assistance to the corporate. The assistance is based on long-term, short-term, working capital, channel financing, Bill discounting, etc.

• Non-fund based assistance like bank guarantee
• , letters of credit, and buyer’s credit.
• Cash management services
• Treasury, both domestic and forex
• Trade Finance
• Govt Business
• Corporate Schedule of Facilities

#3 - MSME Banking

This category mainly focuses on developing Micro, Small, and Medium Enterprises.

• Financial assistance to MSMEs: It includes a full range of banking solutions for MSME entrepreneurs.
• Loan against Property: Providing loans against self-owned commercial and residential properties.
• IDBI Dhanvantari Loan: A loan facility offered to doctors for running a clinic or hospital.
• Loan to small road water transport operators: They play a key role in society’s socio-economic development. This is the financial assistance for buying vehicles or vessels for running their business.
• Sulabh Vyapar Solutions: This is for small traders, retailers, and wholesalers.
• Vendor Financing.
• Laghu Udhyami Credit Cards: This is for the existing customers belonging to micro and small individual unit.
• IDBI loan for the Service Sector: The assistance for those involved in the manufacturing and supplying of goods and services to corporates.
• IDBI Mudra Loan: This facility is focused on those who involved in nonfarm business activities under Pradhan Mantri Mudra Yojana.

#4 - Agriculture Banking

This is the most important and distinct service by IDBI -

• Short-term Agricultural finance like Crop Loans, Gold finance, and warehouse receipt finance scheme.
• Long-term finance like farm mechanization, dug wells, minor irrigation, land purchase for agriculture purposes, land development, Horticulture, and forestry development loans, purchase of bullock and carts, biogas plants.
• Loans for allied activities like poultry farming, dairy farming, fisheries, sericulture, sheep and goat rearing, and Beekeeping.
• Indirect financings like loans to construction and running of storage facilities and development of Agri clinics and agribusiness centers.

#5 - NRI Banking

This is the service to NRIs like NRI accounts, NRE accounts, Remittance services, and FCNR deposits.

IDBI bank provides innovative services as well to its customers like -

• Real-time monitoring System: It enables the customers to scan the transactions to identify fraud.
• Abhay Card Limit Control App: It is an app that allows customers to control their debit and credit cards.
• Mini Enterprise Service Bus: It helps to reduce the solution development time.
• Facebook and Twitter Banking: It helps to carry out transactions through social media platforms safely and securely.

IDBI is now a universal bank operated by cutting-edge core banking platforms; it is one of the largest commercial banks in India, with more than 50 years of glorious expertise in the financing industry. The journey started as DFI, and now it continues as a private sector bank by holding its vision of “To be the most preferred and trusted bank enhancing value for all stakeholders.”

This has been a guide to the Full Form of IDBI and its definition. Here we learn IDBI's functions and subsidiaries and its products and services. You may refer to the following articles to learn more about finance –

• Full Form of SIP
• Full Form of WTO
• Full Form of RTGS
• Full Form of NABARD