After LG’s approval, govt shuts down MSME lender over financial non-viability

New Delhi: Following lieutenant governor's approval, govt has shut down Delhi Financial Corporation, its loss-making MSME lender.According to a gazette notification dated Feb 9, "Delhi Financial Corporation shall stand wound up with effect from the date of publication of this notification in the official gazette." With effect from this date, DFC "shall function only for the purposes of winding-up, namely: realisation of dues, recovery, settlement of liabilities, disposal/transfer of assets and completion of statutory and administrative closure actions", the notification stated. TOI reported in Nov 2025 that Delhi govt had planned to shut down the corporation, weighed down by years of financial losses and a high level of non-performing assets.Govt has constituted a high-powered committee as part of the detailed institutional mechanism to carry out the winding-up process. All powers earlier vested in DFC's board of directors and management stand transferred to this committee. The committee will also oversee the identification and disposal of movable and immovable assets, settle govt and municipal dues, and manage ongoing legal proceedings.Providing safeguards for the employees, the notification stated, "The pay, service conditions, redeployment, retirement benefits, pension/GPF/NPS and all terminal dues of employees of DFC shall be dealt with in accordance with applicable rules, notifications, govt instructions and legal advice, and subject to availability of funds."