While there are the financing support to the project developers opting for the Chinese modules and BoS. This is a cheaper source of debt funding available to the project developers for which the interest rate work out to be of the order of 9% and makes solar PV investment fianncial viable. Following are the typical terms through CDB provide financing of solar projects.
- Borrower is of a good credit status and capable to pay back loan and interest;
- Contract value above 2 million USD, and agrees with the terms of the Export buyer’s Credit;
- Chinese elements should worthy more than 50% of the contract value; for the international contracting
- Borrower should provides sanctified repayment guarantee
- Borrower should be insured by insurance institution if necessary;
The typical documentation for securing the CDB financing are
- Commercial contract
- Introduction of borrower;
- Introduction of the secured party;
- The statutory clearances and approvals of the project from government;
- DPR of the project;
CDB provides loan for a period of 10 years with a typical debt equity ratio of 85:15.