PROJECT loan

Project loan refers to the funding of long-term projects, such as public infrastructure or services, industrial projects, and others through a specific financial structure. Loans can consist of a mix of debt and equity. The cash flows from the project enable servicing of the debt and repayment of debt and equity.

Project loan refers to the funding of long-term projects, such as public infrastructure or services, industrial projects, and others through a specific financial structure. Loans can consist of a mix of debt and equity. The cash flows from the project enable servicing of the debt and repayment of debt and equity.

Project loan model adopted in BOT (build, operate, and transfer) model contains multiple key elements. The funds are arranged through a special purpose vehicle (SPV). A company may carry the project themselves or subcontract a portion of the project. In the absence of revenues during the construction phase, the interest on debt capital is paid after the commencement of operations.