On June 11, 2018, a finance ministry source said that the government was launching a ` 500 crore credit enhancement fund from July 2018 to provide credit enhancement to ease infrastructure investments by insurance and pension funds. The announcement regarding the fund was first made in the financial budget for fiscal year 2016-17.
The India Infrastructure Finance Company Limited (IIFCL) will sponsor the fund and its initial corpus will be ` 500 crore. As a non-banking finance company, it will work.
In the NBFC, there will be a 22.5 per cent stake of IIFCL and 10 per cent stake of Asian Infrastructure Investment Bank (AIIB). State-run SBI, Bank of Baroda and LIC will hold stakes in the firm besides IIFCL and AIIB.