2. Project financing is a long-term financing of industrial
projects which are based on the cash flows. It involves
a number of investors, sponsors who provide loans for
their tasks.
3. Importance of Project FinanceImportance of Project Finance
People need project financing for their major work like they
can need it for transportation, business purposes or it can be
individual use also.
In doing all this work, there can be some risks, so details about
project financings and all related terms should be studied.
5. Characteristics of project financingCharacteristics of project financing
Long term financing using debts and equity
Repaid of debt should be done through cash flows
Project sponsors should be limited
Debts are given on the basis of priorities
7. Stages in Project FinancingStages in Project Financing
Identification of the project
Analysing if there is any risk and then minimising them
Technical support
Negotiation and syndication
Documents and procedures
Monitoring of work and its review
Financial closure stage
9. Advantages of Project FinancingAdvantages of Project Financing
It helps in reducing lender's recourse to the sponsors.
It allows an equity off-balance sheet for debt financing.
Favourable financing should be provided
Better tax treatment should be obtained for the benefit of
project.