NAIF’s primary financing mechanism is the provision of fixed rate, Australian dollar loans. Interest rates and payback period will be determined separately for each individual project. NAIF has the ability to provide concessions on the basis that such concessions are limited to the minimum necessary for a project to proceed. Any concessional interest rate that NAIF may offer cannot be below the combined cost of Commonwealth borrowing and administration costs.
The NAIF Board may consider using alternative financing mechanisms to a loan, such as a guarantee, where:
- it may be more appropriate for a specific project
- it is necessary to encourage private sector participation in financing a project
Where the Board considers that an alternative financing mechanism is preferred to a loan, the Board must write to the responsible Minister seeking agreement to the alternative financing mechanism. The NAIF cannot offer an alternative financing mechanism that would provide equity or grant funding to a project.