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Explain the various types of New Financial Institutions. |
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Answer» 1. Venture Fund Institutions: Venture capital financing is a form of equity financing designed especially for funding new and innovative project ideas. Venture capital funds bring into force the hi-technology projects which are converted into commercial production. 2. Mutual Funds: Financial institutions that provide facilities for channeling savings of small investors into avenues of productive investments are called ‘Mutual Funds’. 3. Factoring Institutions: “Factoring” is an arrangement whereby a financial institution provides financial accommodation on the basis of assignment/sale of account receivables. 4. Over the Counter Exchange of India (OTCEI): The OTCEI was set up by a premier financial institution to allow the trading of securities across the electronic counters throughout the country. 5. National Stock Exchange of India Limited (NSEI): NSEI was established in 1992 to function as a model stock exchange. The Exchange aims at providing the advantage of nation-wide electronic screen based “scripless” and “floorless” trading system in securities. 6. National Clearance and Depository System (NCDS): Under the scripless trading system, settlement of transactions relating to securities takes place through a book entry. 7. National Securities Depositories Limited: The NSDL was set up in the year 1996 for achieving a time bound dematerialization as well as rematerialization of shares. 8. Stock Holding Corporation of India Limited (SHCIL): Stock Holding Corporation of India Limited (SHCIL) aims at serving as a central securities depository in respect of transactions on stock exchanges. The Corporation also takes up the administration of clearing functions at a national level. |
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