General Studies · Project Financing Concepts
In the context of project finance, the term 'non-recourse financing' primarily implies that:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The loan is backed by a sovereign guarantee provided by the central bank of the host country to ensure zero risk.
- 2The project is funded exclusively through equity without any involvement of commercial banks or financial institutions.
- 3Lenders rely primarily on the project's cash flows and assets for repayment, with no or very limited claim against the parent company's assets.✓
- 4The project sponsor is fully liable for the entire debt amount from its personal balance sheet in case of default.
Correct answer
Lenders rely primarily on the project's cash flows and assets for repayment, with no or very limited claim against the parent company's assets.
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