Funding a project on Project Finance basis. The financing of long-term infrastructure and , industrial projects based upon a non-recourse or limited recourse financial structure where project debt and equity used to finance the project are paid back from the cashflow generated by the project.

It also means a loan structure that relies primarily on the project's cash flow for repayment, with the project's assets, rights, and interests held as secondary security or collateral. This involves creation of a Special Purpose Vehicle to set up the project and the project proceeds and project assets are ring-fenced for servicing the debt obligations.

Project finance is especially attractive to the private sector because they can fund major projects off balance sheet.

Financing a project on balance sheet recourse basis. On the strength of the balance sheet any expansion (greenfield or brownfield) or renovation can be funded. Here the primary security is the asset created out of the loan or it may be any existing asset also. Collaterals and personal/corporate guarantee of promoters are also expected by the lenders. In case of any difficulty in servicing the debt obligations, the lender places recourse on the collaterals and/or primary security and the promoters’ personal/corporate guarantee. This is a form of primarily asset based financing instead of cash flow based approach.

Availing loans from lenders for the general corporate purposes. These are also primarily asset based financing and lenders require assets as primary/collateral security in addition to promoters’ personal/corporate guarantee. The proceeds can be used for general corporate purposes including working capital, investment, short term bridge financing for the capex etc.

Any Plant and Machinery capex can be financed under equipment financing or any asset based financing. In such cases the equipment (P&M) is the main security for the lender and it is mortgaged with the lender who provide the loan. Lenders will expect collaterals and personal/corporate guarantee of promoters. NBFCs are more active in this field and provide customised solutions for the requirements of borrowers.

Refinancing of any existing loan at lower rate of interest and with more competitive terms can be done. Sometimes, refinancing can be done to generate surplus cash by doing a higher amount of leverage which is feasible due to repayment of loan and/or relaxation of terms and conditions by the lenders. The objective of refinancing include saving in interest costs and/or generating surplus cash to meet the general corporate purpose requirements.

The quickest way to raise some additional loan by mortgaging any residential or commercial property of the company or promoters. There are no collaterals required for LAP. The property is mortgaged to raise the finance which can be used for any purpose including any capex or opex. The interest rates are most competitive under LAP and terms can be flexible. This comes very handy in case of any stressful condition of the business. All banks and NBFCs deal in this product.

LRD is used for a different purpose when the borrower do not want to sell his asset (primarily a residential or commercial property, though it can be any other asset also) and want loan on the basis of discounting of future lease rent receivables under any lease contract. Very popular among the real estate investors and it offers very competitive mode of quick financing.

Requirement of real estate and construction companies when they want to borrow for the purpose of construction of the asset which is being constructed/to be constructed from such funding. Limited set of lenders work in this place because of inherent risks involved in construction financing. The project proceeds are ring-fenced for debt service obligations.

Required by any business for funding their working capital requirement or funding the normal trade cycle. Working capital/trade financing require hypothecation of the stock and debtors and the lenders will also be looking for collaterals and personal/corporate guarantee of promoters. Typically any fund base and/or non fund based limits are arranged covering Cash Credit, LC/BG, Buyer’s Credit, PCFC, Export Credit etc.