Limited Recourse Financing in Project Finance

  • Naman Bansal
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  • Naman Bansal

    Student at Maharashtra National Law University, Aurangabad, India

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Project finance has become a popular way to fund large-scale, capital-intensive projects including power plants, oil pipelines, highways, and tunnels, among other things. In a project finance arrangement where the project's lenders have limited access to the sponsoring company's assets, we examine debt capacity and risk selection. We draw a comparison between project finance loans with limited recourse and susceptible financial guarantee loans. We demonstrate the trade-offs between risk and debt capacity using contingent claims analysis in instances where the project's lenders have recourse to the sponsor's assets and in cases where they do not.


Research Paper


International Journal of Law Management and Humanities, Volume 4, Issue 5, Page 2189 - 2201


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