Why school funding is important?
With the increasing rate of literacy in India, we can see an increasing demand for schools. The demand for schools is spreading due to awareness or importance of education among the residents at large. Schooling or primary education impart largely on the individuals life and is also considered an integral part. Thus, school is the very first step in the success of life. We need more and more good and competent schools to spread the social cause of education and to make India 100% literate.
Starting a school is not at all an easy task, it has to go through many steps which include land or premises allotment, construction of building, hiring staff, documentation, etc. To overcome these challenges, funding is provided to improve the infrastructure and to meet growing expectations of individuals. This facility is obtained through Project Funding or term loans, as per the requirements of borrower.
Services available for School Funding
The following are the services through which school funding can be undertaken,
A) Project Funding
Not only planning is important for starting new projects, but also to manage the costs of the project, hence funding is an integral part. Project Funding is an appropriate platform for the fulfilment of such finance. For starting a new school, the borrower can opt for project funding where the whole project will be kept as collateral, and the funds would be disbursed against it. It is the most convenient and reliable product where one can obtain funds at a moderate rate of interest.
Risk Sharing: Many times, due to a large requirement of funds, there is an involvement of more than one lender. In such a case, the capacity of debt is also shared due to the presence of multiple entities.
Longer Tenure: The tenure offered by the project funding is usually high as this product is mostly taken for developing infrastructure.
Revenue after the completion of the project: The major advantage of opting for project finance is that the repayment period will start after the completion of the project and once the project starts generating revenue. This will help the borrower to complete the project at ease and stress-free.
Stages of project funding
There are three stages involved in the project funding namely, pre-financing, financing and post-financing.
B) Term loan
The existing schools who wish to renovate or expand the existing structure can opt for the term loan. The term loan has fixed EMIs, a fixed amount and a fixed term. Usually, the rate of interest is also fixed. Such loans are available through a secured way of funding and the repayment is flexible and done through EMIs. The period/tenure, repayment and ROI totally depends upon the requirement and authenticity of the borrower.
High credit score, larger amount of fund: If the credit score of the borrower is high, then the higher amount of loans can be sanctioned. Based on the CIBIL score, the amount, interest and other factors are decided.
Reasonable cost of borrowing: Available against the collateral, the school funding provides loans at the reasonable cost of borrowings to the clients.
Tax benefit: Interest payable on term loans are tax-deductible and thus tax benefit is obtained.
How does Terkar Capital process funding?
Why choose Terkar Capital?
Terkar Capital assists the schools in building, developing and enabling students to learn, improve and access quality education. The main objective of providing school funding is to allow the promoter to turn his idea into reality and provide the best suitable financial product. However, Terkar Capital strongly believes in Transparency during the whole process and protects the confidential information of the clients. We arrange for you the finest options
If you have any questions, please do not hesitate to ask us. Please also call us or email us before visiting to make sure that you will be served with our best services.
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