What is Project Financing?
We recently announced that Fidelity Capital now offers project financing services for projects of all types in all industries. But what exactly is project financing?
Most simply, project financing is the financing of any types of long-term infrastructure or projects. Project debt and equity that are used in the financing of the project are then paid back from cash flow the project generates.
Compare this type of repayment to equipment financing, where there’s a standard repayment agreement that lasts an agreed upon amount of time. This idea of using money specifically generated from the project is unique to project financing, and bears more of a resemblance to an investor putting a certain amount of stake in a company and getting some back. The difference here, obviously, is that this agreement only lasts until the debt is repaid.
Project financing examples
One primary example of a service that would fall under this umbrella is 100% Software Financing.
Leasing and financing may be more commonly associated with hardware and equipment, but companies that require a large amount of software also find that financing could be their best option. Through project financing, Fidelity Capital is able to finance up to 100 percent of software, including maintenance and installation. This provides companies with the chance to get all of the software they need with little or no money up front while still being able to make low monthly payments.
Similarly, software development financing is an option for companies that are looking to build more in-depth websites, software platforms for their sales force and any other in-house software needs. This means that rather than settling for cookie-cutter CRM services or boring website templates, companies can get websites and applications with custom-tailored functionality for their unique needs.
Again, having project financing services available to fund these processes helps companies to get the websites and software they need to stay viable, especially in the startup phase. In today’s technology-driven business world, those types of applications are vital to a company’s success. Then they will be able to repay their debt through the profits they make from the software they obtained through the funding.
Outside of software and digital technology, project financing is also particularly useful for industrial projects and constructing unique technology and equipment for a variety of companies.
Contact Fidelity Capital for more information
Project financing provides businesses with numerous options to get the funds they need for more than just equipment or storefronts. Contact the Fidelity Capital team for more information about how this exciting new service could transform your company.
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