Non-Recourse
Financing

Almost always used in project finance, non-recourse financing is when the lender or investor looks mainly to the revenue projections for the repayment of its loan.  Collateral in this type of financing are the assets of the project, which means project sponsors are not held personally liable for the payments on the loan if the project doesn't generate enough profit.


This is most often used as the financing method when projects require very large funding – such as the construction of power plants, industrial facilities, manufacturing plants, large resorts, etc.  Please read more about non-recourse financing under Project Finance.