Full Form of DFC, Delhi Finance Corporation

Delhi Finance Corporation (DFC), Government. of Delhi, is a state-owned financial institution engaged in promoting, financing and developing SMEs and services in Delhi and Chandigarh.

History of DFC?

The Delhi Finance Corporation (DFC) was a national finance corporation in 1951. However, restructuring the Punjab Finance Corporation (PFC) was split in 1967 into four SFCs, namely the Delhi Finance Corporation (NCT in Delhi and UT in Chandigarh). Established in April 1967, Punjab Financial Corporation (Punjab), Haryana Financial Corporation, and Himachal Pradesh Financial Corporation (Himachal Pradesh).

Objective of DFC

The company's main objective is to provide financing for the establishment and operation of micro, small and medium enterprises. However, the service and the trade/transport sectors in NCT, Delhi and UT, Chandigarh. DFC is key in promoting MSMEs and the service sector. They do not operate under the SFC Act 1951 to construct restaurants/hotels, amusement parks, hospitals/nursing homes/clinics/diagnostic centres, commercial vehicles, etc.

Companies can give financial support up to Rs. INR 1000 crore for companies and cooperatives and INR 400 crore for privately run and partnership enterprises. The repayment period is longer than other financial institutions.

Scope of Activity

The company provides financial support to micro, small and medium enterprises. Moreover, the service and commercial transport sectors in the Delhi metropolitan area and the Union Territory of Chandigarh. However, the company focuses on social goals such as eradicating poverty, creating jobs, creating self-employment opportunities, relocating industries, cleaning the environment, and fostering first-generation entrepreneurs. Therefore the Corporation will fund all activities to get permits under the SFC Act.

Loan Scope

Rs. 10.00 crore (enterprises and cooperatives)

Rs. 4.00 crore (owned and partnership company)

Moreover, companies in the industrial units/services sector with the amount registered as capital and a free reserve of Rs 300 crore are eligible for the loan.

Interest Rate

1. Company adopts a fixed interest rate system, and the interest rate is calculated based on balance reduction. However, the typical interest rate is 12% per annum. DFC also offers an annual discount of 0.75% when:
2. a) Stocks rated within the top three credit ratings of CRISIL/ICRA/SMERA/CARE/FITTCH, with agency credit ratings in effect on the date of application;
3. b) Existing borrowers have been standard assets for the past three years. 
4. c) A previous customer of the company whose loan remained standard for the life of the loan.
5. d) Other favourable cases determined by CMD. The interest rate of 12% per annum. Moreover, the proposed benchmark interest rate for the Internal Credit Scoring and Ratings Model (CSRM) will be implemented by entities in all cases except where applicable to asset-based financing and transportation.
6. An additional interest rate of 1.75% per annum will be charged over the amount of default and period. Interest rate change on the first payment under RBI/SIDBI/DFC guidelines will apply. However, even if the loan was approved and the mortgage/mortgage deed was previously issued.
7. Interest is calculated on an EMI/Quarterly basis according to the funding plan. Also, during the moratorium period, interest will get calculated and gathered monthly/quarterly according to the loan schedule.
8. However, loan repayments (paid and unapproved amounts) drawn by the borrower can be charged along with regular interest on a daily product basis and additional interest in case of delay.

Prepaid Fee

However, in the case of prepayment/advance of the loan, the borrower must pay an advance payment fee equal to 2% of the principal balance.

Commission

In all cases, the processing fee is 0.5% of the loan amount + (taxes where applicable). However, other expenses must be borne by the borrower. However, expenses necessary to proceed with the lawsuit (property valuation expenses, attorney fees for title searches, inspection fees, etc.)

Fundraising Program

The company is licensed under the Delhi/Chandigarh Master Plan to fund all manufacturing and service sector activities per the Delhi/Chandigarh Government's Industrial Policy. Moreover, entrepreneurs provide funding for establishing hospitals, nursing homes, diagnostic centres, tourism-related activities, hotels, restaurants, amusement parks, hi-tech electronics/software industries, and various service sector activities such as boutiques, beauty salons, etc. However, they welcome procurement. Therefore per the requirements of the characteristics of the metropolis of Delhi/Chandigarh.

For ID Proof

1. i) Passport, voter ID, driver's license, employer letter, payslip
2. ii) PAN card, Aadhaar no.

Conclusion

DFC plays a vital role in finance. Moreover, the company offers a variety of programs that meet the needs of all categories of entrepreneurs, whoever may come from weaker segments of society or belong to special or general categories.

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