1. Development banks are financial institutions (DFIs) that provide long-term credit for capital-intensive investments with long payback periods, such as urban infrastructure, mining and heavy industry, and irrigation systems.
2. Such banks frequently lend at low and stable interest rates in order to encourage long-term investments with significant social benefits.
3. IDBI (Industrial Development Bank of India) was established in 1964 as the apex body of all development finance institutions.
4. It provides financial assistance not only to private-sector enterprises but also to public-sector enterprises.
5. Its motivation is to serve the public good rather than to make a profit. It works in the best interests of the country as a whole.
6. Examples of Developmental Banks in India are: SIDBI, EXIM, NABARD, NHB, The Industrial Development Bank of India (IDBI), Industrial Financial Corporation of India (IFCI).
