Full Form of IFC

Full Form of IFC – International Finance Corporation

The full form of IFC is the International Finance Corporation. International Finance Corporation can be defined as a global financial institutionFinancial InstitutionFinancial institutions refer to those organizations which provide business services and products related to financial or monetary transactions to their clients. Some of these are banks, NBFCs, investment companies, brokerage firms, insurance companies and trust corporations. read more that solely focuses upon the development of the private sector in the developing economies by offering the same with necessary services pertaining to the advisory, investment, and asset managementAsset ManagementAsset management is a method of managing funds and investing in both traditional and specialized products in order to generate returns consistent with the investor's risk tolerance. read more and it aims at creating better livelihood and such other opportunities for people so that they can deal with poverty and have a better standard of living.

History

International Finance Corporation was established in the year 1956. International FinanceInternational FinanceInternational Finance is a section of Financial Economics that deals with the macroeconomic relationship & monetary transactions between 2 or more countries. It includes concepts like Exchange Rates, Interest Rates, FDI, & Balance of Payments etc. read more Corporation was established as a private affiliate of the WB or World Bank. IFC has its headquarters in Washington, D.C., U.S. IFC was established to infuse and advance economic development and encourage the growth of the private industry in the developing economies by strictly making an investment in commercial and profitable projects and simultaneously curbing poverty in the same.

You are free to use this image on your website, templates etc, Please provide us with an attribution linkHow to Provide Attribution?Article Link to be Hyperlinked
For eg:
Source: Full Form of IFC (wallstreetmojo.com)

Purpose of IFC

The purpose of International Finance Corporation are:

  • In association with the private sector investors, IFC aims to fund the foundation, improvement, growth, and expansion of the private sector industries and simultaneously pave ways for the development of its member nations.
  • IFC seeks to attract more and more investment opportunities, national and international private capital, as well as experienced management.
  • IFC even seeks to stimulate and create favorable conditions for national and international private capital’s smooth flow into meaningful and productive investments in member nations.

Objectives

The objectives of International Finance Corporation are:

IFC Objectives

You are free to use this image on your website, templates etc, Please provide us with an attribution linkHow to Provide Attribution?Article Link to be Hyperlinked
For eg:
Source: Full Form of IFC (wallstreetmojo.com)

Strategies

The five strategies of International Finance Corporation are:

IFC Strategies

You are free to use this image on your website, templates etc, Please provide us with an attribution linkHow to Provide Attribution?Article Link to be Hyperlinked
For eg:
Source: Full Form of IFC (wallstreetmojo.com)

How does it Work?

International Finance Corporation(IFC) considers only a few investment proposals. These investment proposals are solely selected based on their focus upon the establishment, improvement, and growth of productive privately held companies that will ultimately bring development for an under-performing economy. Agricultural, financial, industrial, and other commercial industries are eligible for International Finance Corporation funding if only their operations are found productive in character.

IFC is authorized to make funding as and however it may deem fit, excluding the investment in capital stocksCapital StocksThe capital stock is the total amount of share capital (including equity capital and preference capital) that has been issued by a company. It is a way of raising funds by the company to meet its various business goals.read more and equity shares. IFC does not really have a uniform interest rate policy about its investment function. In an IFC, the interest rates are to be negotiated for each case based on few relevant factors that include the level and types of risks involved, the right to participate in profits, and so on. International Finance Corporation invests only when the enterprises are found to have relevant experience and competent management.

Example of IFC

Pakistan ranks number four globally when it comes to the production of milk. Instead of such huge milk production, the demand for milk has always outweighed the same supply. Poor infrastructure, conventional and ineffective processes are majorly why the country’s dairy industry has struggled to balance out the demand and supply of milk. Its small scale dairy farmers produce almost 80 percent of the country’s milk. On account of an inefficient supply chain, the country’s overall milk industry has become inefficient.

International Finance Corporation contributed nearly $145 million to a Dutch co-operative Friesland Campina to acquire a 51 percent stake in Engro Foods, which happens to be Pakistan’s leading milk processing company. Engro Foods was now able to receive the benefits of this association and received raw-materials from Friesland Campina. This enhanced the productivity and efficiency of the small scale farmers of the country and reduced their wastes. This acquisition and association were expected to benefit 270,000 distributors and 200,000 farmers and create 1000 new job vacancies in Pakistan’s dairy industry.

Services

International Finance Corporation offers investment, advisory as well as asset management services that further comprises of loans, trade and supply chain financeSupply Chain FinanceSupply Chain Finance, also called Reverse Factoring, is an arrangement in which the supplier gets advance payment for receivables through a financier on behalf of the buyer. It provides significant benefits for both the buyer & the supplier. read more, equity, blended finance, treasury client solutions, syndicated loans, client risk management services, structures as well as securitized finance, liquidity management, treasury services, venture capitalVenture CapitalVenture capital (VC) is long-term finance extended to startups with high-growth potential to help them succeed exponentially. The investors are venture capitalists who bear the excessive financial risk and provide guidance to startups to attain their objectives.read more, etc.

Conclusion

International Finance Corporation offers various services in investment, advisory, and asset management too. IFC is an international financial institution that aims to develop and develop private industries in developing nations. IFC aims to create better livelihood opportunities for people so that they can rise above poverty and enjoy a better standard of living.

Recommended Articles

This has been a guide to the Full Form of IFC and its definition. Here we discuss how does IFC works, its strategies, objectives, purpose, along with an example, and services. You may refer to the following articles to learn more about finance –

Reader Interactions

Leave a Reply

Your email address will not be published. Required fields are marked *