Crowdfunding for Infrastructure Project Financing

2022 ◽  
pp. 276-300
Author(s):  
Nika Pranata ◽  
Nur Firdaus ◽  
Erla Mychelisda ◽  
Achsanah Hidayatina

Infrastructure plays a pivotal role in national development. However, financing infrastructure projects becomes a major hurdle as it is often considered unbankable, high risk, and requires a long payback period. The use of crowdfunding as an alternative source for infrastructure project financing is flourishing, especially in European and American countries. In contrast, the utilization of crowdfunding for such purposes in Asian countries is very limited. Hence, this study reviews four crowdfunding platforms in Europe and America that have successfully raised capital for infrastructure projects which are Oneplanetcrowd, Convergence Finance, Citizenergy, and Infrashares. Learning from best practices of those platforms, policies, and regulations, the study proposes four crowdfunding business models to be implemented in Asian countries including (1) blended finance, (2) cross-border citizen funding, (3) commercial infrastructure financing, and (4) within country crowdfunding.

Yuridika ◽  
2019 ◽  
Vol 35 (1) ◽  
pp. 129
Author(s):  
Rega Felix ◽  
Lastuti Abubakar

Islamic bank has a huge potential to involve in large project financing such as infrastructure. The demand for infrastructure provision in Indonesia is growing rapidly, so the Islamic bank should become one of the financial institutions for a financing infrastructure project. One of the products of Islamic bank is lease based contract or ijarah. In 2016, the Indonesian Islamic Scholars Council (MUI) enacted Fatwa that allowed ijarah contract for a forward obligation or called al-ijarah al-maushufah fi al-dzimmah (IMFD). IMFD has some characteristics that equitable for infrastructure project needs, such as for long term financing. The main issues in this research are to drawn a model for infrastructure project financing by applying IMFD and observe the readiness of Indonesian regulation to support the implementation of IMFD on infrastructure project financing. The type of research is the normative study, and the approach of this research having four methods approach among others are statute approach, conceptual approach, cases approach, and comparative approach. The results of this research are model for infrastructure project financing by applying IMFD is by combining musharakah-istishna’-ijarah (IMFD) and regulation in Indonesia is not ready enough to support the implementation of IMFD on infrastructure project financing because combination of three contracts like musharakah-istishna’-IMFD, implementation of liquidated damages in istishna’ contract, and allowance IMFD in infrastructure project are not regulated in Indonesia.


2021 ◽  
Vol 20 (2) ◽  
Author(s):  
Akhmad Rifai ◽  
Andi Tenrisuki Tenriajeng

Increasing the welfare of the Indonesian people, especially Muslims, encourages religious activities that require financial readiness, namely the Hajj. The high enthusiasm of Indonesian Muslims to register is not balanced with the quota of prospective pilgrims who depart each year, making the waiting list for the pilgrimage longer. The number of recipients of prospective pilgrims continues to grow from year to year. Registrants who want to perform the Hajj until June 2018 are 3,797,376 while the annual Indonesian Hajj quota is around 210,000 people. This creates an accumulation of initial deposit funds, in March 2018  total of hajj fund Rp. 105,191,372,936,614 were collected. This study aims to assess whether the Hajj funds are worth investing in toll road infrastructure projects. Starting from identifying problems to calculating investment feasibility to cooperation agreements Management of Hajj funds with Islamic banks under musyarakah mutanaqishah agreement to investing in toll road infrastructure projects. The capital budgeting method is used to calculate the feasibility of investment, NPV value of Rp. 54,805,724,000,000, then IRR value is 62%, BCR is 3.61, and payback period is 12 years. The conclusion is Hajj fund is worth to investing in the toll road infrastructure project Jakarta - Cikampek II Elevated.


2021 ◽  
Vol 23 (4) ◽  
pp. 36-42
Author(s):  
ANASTASIA SHVYDKO ◽  

The article considers project financing as an investment tool for financing infrastructure projects since recently this approach is quite relevant in Russia. The analysis revealed both the strengths for the development of project financing and the factors constraining its application. In the research, the author identified some problems connected with the participants of project financing as well as with the use of debt instruments. In project financing, the key role is played by the generated cash flow. An important condition for its compliance with forecast parameters is not only the improvement of the corporate management system but also the creation of a satisfactory system for monitoring and operational control over the implementation of projects through the optimization of all processes. It is also important to improve the system of benefits and guarantees for investment projects using project financing The article formulates measures, the adoption of which can contribute to wider and more effective use of project financing for implementing infrastructure projects.


2020 ◽  
Vol 6 (1) ◽  
pp. 129-145
Author(s):  
Natalya A. Zhuravleva ◽  
Tomas Kliestik

Background: The realisation of large-scale plans of Russian infrastructure development, transport in particular, requires a corresponding methodological guidance for both planning of realisation of these tasks and development of the proper financing instrumentarium. Aim: The analysis of reasons for incompliance of programme tasks with their financing conditions; formalisation of investment trends in todays economy and description of their capability to adapt to Russian projects. Methods: The method of rising from concrete to abstract and vice versa has allowed identification of important regularities of investment trends and their connection with the quality of projects; the systems principle has confirmed dependence of successful realisation of infrastructure projects on reliability of economic development forecasts and adequacy of projects financing and management. Results: The analysis of ongoing changes of state priorities and programmes, outlined in a large number of documents regulating development of transport infrastructure in Russia, has allowed identification of influence of most significant regularities, which determine effectiveness of these solutions. All available transport infrastructure project financing sources have been systemised, considering investment volume and their status in the market. The statement that it is exactly the loan-based financing sources, concession in the first instance, that can be the most efficient in infrastructure projects realisation, has been confirmed.


10.14311/290 ◽  
2001 ◽  
Vol 41 (6) ◽  
Author(s):  
O. Pokorná ◽  
D. Mocková

A typical feature of transport infrastructure projects is that they are expensive and take a long time to construct. Transport infrastructure financing has traditionally lain in the public domain. A tightening of many countries' budgets in recent times has led to an exploration of alternative resources for financing transport infrastructures. A variety of models and methods can be used in transport infrastructure project financing. The selection of the appropriate model should be done taking into account not only financial resources but also the distribution of construction and operating risks and the contractual relations between the stakeholders.


Subject The National Development Bank. Significance Development banks of the developing world, like Brazil's National Development Bank (BNDES) and the China Development Bank, play an increasing role in financing infrastructure projects in other developing countries. A challenge for understanding the role of this lending is that transparency by these banks has been low. In 2015, the BNDES put a complete record of its support for the export of Brazilian goods and services online, allowing an analysis of its past patterns of lending. Impacts The BNDES has improved its transparency but corruption issues still plague many of its loan recipients. The drop-off in new projects appears set to continue despite the need for infrastructure funding. The focus may also increasingly concentrate on Brazil rather than projects by Brazilian companies elsewhere.


2020 ◽  
Vol 25 (3) ◽  
pp. 347-369
Author(s):  
Pankaj Kumar Gupta ◽  
Harender Verma

Purpose The purpose of this paper is to examine the risk perception of project sponsors in financing of public–private partnership (PPP) infrastructure projects in India. Design/methodology/approach The methodology used is survey questionnaire that seeks the perception of risk managers in PPP projects. Rating and relative ranking of risk at various phases of PPP project have been analyzed and supplemented by unstructured interviews. Findings This paper shows that the perception of project sponsors for various levels of project risk categories differ significantly in PPP infrastructure projects. The practices of assessing risk and handling differ among the financing institutions. The ranking of risks shows a disagreement among respondents for relative importance. The project financiers that include major banks and financial institutions funding for the PPP infrastructure projects perceive risks differently, and their disagreement on the relative importance of risks may create a sub-optimality in risk management, and the essence of project sponsorship may be lost. Research limitations/implications This paper examines the perceptions of the various risks involved in PPP infrastructure project financing. The authors emphasize on the infrastructure projects in the transportation and energy sector that are undertaken in the PPPs. This research can further be extended to the other infrastructure sectors such as roads, shipping and communication. Practical implications Experiences reveal that risk perception profoundly influence the implementation of infrastructure projects involving PPPs. To ensure smooth implementation and success of PPP infrastructure projects, the project sponsors must align, synchronize and develop consensus on the various funding and non-funding risks into the project curriculum. Social implications The PPP infrastructure projects carry huge investment and are of strategic importance to the nation and society. In order that the provision of infrastructure which can be most economically and efficiently delivered through PPPs, the risk concordance assumes crucial importance. Originality/value The authors believe that this research may provide new direction to the visible and invisible misbalances in risk postures of project partners, which has been a cause of concern to the government and policymakers in India in the recent times.


2021 ◽  
Vol 4 (3) ◽  
pp. p22
Author(s):  
Junyou Liu

Megaprojects are defined as projects that cost a billion US dollars or more at 1990 prices. Mega transport infrastructure projects have the potential to affect important socioeconomic and territorial changes. They are often perceived as critical to the “success” of major metropolitan, regional and national development. The redevelopment of neighbourhoods offers many opportunities for regional regeneration, yet there remain concerns regarding the potential gentrification of areas leading to the displacement of existing populations and local businesses. This research applies multi-criteria analysis, a tool that is widely used in mega infrastructure project appraisal using the UK’s Crossrail as a case to explore the likelihood of gentrification and the displacement impacts of the project. This paper finds both positive and negative impacts. Different stakeholders express noticeably differing opinions regarding the project.


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