Film Completion Bonds
Completion bonds (or guarantees) covers completion risk, i.e., they will cover the film in the event a film is not made within budget and as per the original production timeline.
Banks perceive film completion risk as the greatest risk. With completion guarantees in place, the possibility of a film project getting organised finance is higher. However, the guarantors retain some control… Completion guarantee acts as a creative controller to evaluate the initial script, budgets and contractual agreements with related parties. It monitors the film production to ensure that it stays on schedule and budget ensuring that there are no deviations.
Without these funds, producers have to fork out interest rates as high as 40 per cent. In return for the guarantee, producers will have to part with about 5 percent of their equity on the film.
- GENERAL Insurance Corporation of India (GIC) has entered the field as reinsurer (read report here ).
- Pyramid Saimira Theatres Ltd has tied up with Infinity Film Completion Services to offer completion guarantees in the South Indian film industry (read report here).
- US-based Film Finances Inc has formed a 70:30 joint venture with Kaleidoscope Entertainment, a company promoted by Bobby Bedi of ‘Bandit Queen’ fame, for providing film completion guarantee services in the country (read here )