An Overview on Operational Performance of Karnataka State Financial Corporation

Karnataka State Financial Corporation (KSFC) is a State level financial institution established by the Karnataka State Government in the year 1959 under the State Financial Corporations Act 1951 to meet the financial needs of Micro, Small and Medium Enterprises (MSMEs) in the State of Karnataka. As a pioneering and responsive financial institution, KSFC is fine-tuned to fulfill the plans and aspirations of entrepreneurs by extending all possible assistance. In the 55 years of its existence, KSFC has contributed most significantly for the growth of SMEs, backward area development and promotion of first generation entrepreneurs. With this background the present study made an attempt to provide clear picture of the operational performance of KSFC. In this paper, the study intends to examine the Operational Efficiency Ratio of KSFC, the flow of assistance in terms of sanctions and disbursements, flow of credit to micro and small scale sector, sector wise disbursement of loans by KSFC, Recovery performance of the KSFC and district wise disbursement performance of KSFC. The study has used Multiple Regression Analysis to analyze the determinants of Operational Efficiency Ratio and the results have some policy implications.