Producers typically rely on local financiers for film funding. Each banner has a regular financier they trust, who funds every project. This finance comes at an interest rate of 24%.
Some producers borrow from wealthy acquaintances at a lower rate of 18%. However, in urgent cases, the interest rate can rise double to that of the principle, before a film’s release.
Despite the high cost, producers avoid borrowing from out-of-state financiers due to their strict rules. Any discrepancy could jeopardize the film’s release.
However, one prominent producer took a significant loan from a financier in a neighboring state for a major film.
The producer was forced to seek external funding after the local financier could not offer more, even though the terms were non-negotiable.
Fellow producers are shocked by this decision, especially since they know the interest rate is steep. They are whispering about how much it has already increased, criticizing his choice to go ahead with financing under these tough terms.