Gujarat State Financial Corporation

History of Gujarat State Financial Corporation

Gujarat State Financial Corporation (GSFC), established on 1st May, 1960 and operating from Gujarat is the second state level developmental institution to go public, after Haryana Financial Corporation. Its main object is to provide financial assistance to small and medium scale new/existing industrial and service sector units all over Gujarat for acquisition of fixed assets, preliminary and pre-operative expenses, expansion, modernization, diversification etc. The Corporation is a Category-I Merchant Banker. It lends to small and medium scale units. It also engages in leasing, hire purchase and fee based activities. Currently, it is engaged in the activity of recovering dues from its borrowers and paying its lenders. The Corporation came out with a Public Issue in Feb.'97 at a premium of Rs. 10. The State Government of Gujarat hold 53.03% in the Corporation as at March 31, 2025. GSFC took up the lead to encourage entrepreneurship in hi-tech agriculture & accelerate the growth in this sector. It has taken on an added role of nodal agency for export promotion in Gujarat by actively exploring potential export market and identifying overseas business opportunities. The Corporation has starting online services wherein all the assisted customers have complete information at the press of computer keys. GSFC was appointed as the Channelising Agency by NHFDC to sanction loan at a concessional rate of interest between 5% to 10%. GSFC played an important role in the industr ...ial development of the State. Till date, it financed 47,331 units and disbursed Rs. 3,300 crore, generating employment for over 6,00,000 persons. Many units financed by it are still now well established and have graduated from small to medium and large scale. Apart from this, One Time Settlement schemes have been introduced to expedite recovery. Cost cutting exercise has been implemented to reduce manpower by deputing staff to various Government departments and by implementing VRS. Hence, the Government has formed a high-powered committee under Chief Secretary to decide on the future of GSFC. Committee decided to offer VRS to employees, have OTS scheme and restructure the organization as well. The main objective of establishment of the Corporation is aimed at achieving balanced regional growth by extending financial assistance to first generation entrepreneurs to establish micro and small scale units in the State and to generate employment. Corporation has so far suffered immense loss and its net worth is already eroded but it is continuing its recovery function in 2023.