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MONEY MARKET
Money market is the market in which short term funds are borrowed and lent. Indian Money Market is not an integrated unit. It is broadly divided into two parts:
MONEY MARKET
Who are indigenous bankers? They are individuals or private firms which receive deposits & give loans and thereby operate as banks. Since their activities are not regulated . They belong to the unorganized segment of money market. a) Gujarati shroffs b) Chettiars & Marwari kayas
MONEY MARKET
Who are Money lenders?
Professional money lenders whose main activity is money lending. Money lenders like Pathans and Kabulis. There are several types of unregulated non-bank financial intermediaries .
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Financial Companies lend loans to artisans, peasants & other self employed persons and they charge high rates of interest.
Chit Funds- saving institutions. A chit fund has regular subscription to the funds. The periodic collection is givn to some member of the chit fund selected on the basis on previously agreed criterion.
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MONEY MARKET
Organized sector of the money market comprises both Nationalized and the private sector commercial banks. RBI, Co-operative banks, Foreign Banks, Discount and Finance House of India, development finance institutions like IDBI, ICICI and investment finance companies like the LIC, GIC and UTI and Mutual funds are the other institutions which operate in the organised sector of the Indian money market.
MONEY MARKET
RBI- the apex organization in the Indian money market. It is the leader and controller of the money market, it has great responsibility in respect of smooth functioning of the financial system.
MONEY MARKET
The principal constituents of the Indian money Market are: Call money market meant to balance the short term needs of banks. UTI & LIC were large lenders. These investment Institutions had a sizable shortterm float which they could profitably deploy in the call money market. Commercial banks were usually borrowers CMM centred at Mumbai, Calcutta & Chennai. Treasury Bill Market: short term liability of central Govt. It is issued for meeting the temporary deficits which Govt. faces to its excess expenditure over revenue at some point of time. RBI captive holder.
MONEY MARKET
Commercial Bill Market: bills arise out of domestic Transactions. The legitimate purpose is to reimburse the seller while the buyer delays payment. Commercial bills as instruments of credit are useful For both business firms and banks. Certificate of Deposits Market: CD issued is a certificate by a bank to depositors of funds. CDs are similar to the traditional term deposits but are negotiable and tradable in the short term money markets.
MONEY MARKET
Commercial paper Market: short term instrument of raising funds by corporates. Money Market Mutual Funds: MMMFs introduced by RBI. Objective of the scheme was to provide an additional short-term
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CM- refers to all the facilities and institutional arrangements for borrowing and lending term funds.
Business unit needs money to finance its activities. Money is invested in physical resources, land and building, Machines and equipment, stock of raw materials, etc. Which are used by the enterprises in production. All these resources together constitute Capital is often defined Wealth
1. For financing Five year plans 2. Mobilization of savings and acceleration of capital formation 3. Promotion of Industrial Growth 4. Raising long term capital 5. Ready and continuous market 6. Proper channelisation of funds 7. Provision of a variety of services
FOREX MARKET
Foreign exchange is the process of converting currencies of foreign country into that of the home currency.
And a place where these transactions is carried called as foreign exchange market.
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INDUSTRIAL FINANCE
Finance is the life blood of industry. Adequate finance is absolutely necessary to oil the wheels of the industrial machine to ensure its smooth working & to prevents its breakdown. Lack of adequate & timely finance is one of the causes of slow development of industries of India.
INDUSTRIAL FINANCE
Why industry needs finance? Industry needs finance to meet the capital expenditure i.e. purchase of land, erection of factory building, for installation of machinery. Working capital- to meet its day to day requirements of the industry i.e purchase fo raw material ect.
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THE INDUSTRIAL CREDIT AND INVESTMENT CORPORATION OF INDIA LTD (ICICI) ICICI BANK second all India Development Bank set up in 1955. ICICI Bank differes from two other all india development banks the IFCI & IDBI in respect of ownership, management and lending operations
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Expanding channels for marketing the products of the small scale sector.
Promotion of employment oriented industries especially in semi-urban areas to create more employment opportunities. Extending financial support to State Small Industries Development corporations.
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