BANKING AFFAIRS

Detailed explanation-1: -Banks, financial institutions, and non-banking financial companies (NBFCs) can create these funds. A trust-based IDF is typically a Mutual Fund (MF), whereas a company-based IDF is typically a type of NBFC. A trust-based IDF (MF) would be governed by SEBI, whereas a company-based IDF (NBFC) would be regulated by RBI.

Detailed explanation-2: -Ans : IDFs are investment vehicles which can be sponsored by commercial banks and NBFCs in India in which domestic/offshore institutional investors, specially insurance and pension funds can invest through units and bonds issued by the IDFs.

Detailed explanation-3: -Infradebt is an Infrastructure Debt Fund (IDF) under NBFC format, formulated by the Government of India, with the objective of creating an alternative class of funding infrastructure by bringing in long term domestic/offshore institutional investors like insurance companies, provident/pension funds, etc.

Detailed explanation-4: -Introduction: Infrastructure Finance Company Infrastructure Finance Company provides credit facilities to the borrowers in the specific infrastructure sectors. The creation of a separate category of NBFC’S (NBFC-IFC), expected to plays a major role in the banking industry as a provider of infrastructure finance.

Detailed explanation-5: -Infrastructure debt funds typically invest in debt linked directly to projects, rather than debt linked to a corporate entity. Known as project finance, this type of debt has become increasingly popular in recent decades, as it allows a sponsor to shift risk off its balance sheet.