Banking

Canara Bank chosen as a partner for HEFA

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canarabankThe government has chosen Canara bank as the joint venture partner for the establishment of a Higher Education Financing Agency.

The Higher Education Financing Agency (HEFA) is a not-for-profit agency with an initial capital base of Rs. 1000 Crore and was announced in the last budget.

To be set up under the Companies Act, HEFA will be registered with Reserve Bank of India (RBI) as Non-banking Finance Company (NBFC).

This NBFC, to be headed by a banker, will have a board with five donors and five institutions selected on rotation basis. All centrally funded higher educational institutions will automatically be added as members.

The body will source funds from the market and supplement them with donations and CSR funds.

These funds will be used to finance improvement in infrastructure in India’s top educational institutions by supporting capital expenditure for building infrastructure in IITs, NITs, IIITs and IISERs and central universities.

It will also be used to fund state-of-the-art research labs and other infrastructure.

The bank said it has initiated steps in this regard to operationalise the HEFA subject to necessary approvals or permissions “from the regulators and the Government of India”.

Canara Bank is an Indian state-owned bank headquartered in Bangalore, Karnataka. It was established at Mangalore in 1906. The government nationalized the bank in 1969.

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