Commitment Commission

By August 23, 2022No Comments

Otherwise known as Non-Utilisation Fee. A fee charged by lenders on the unutilised portion of a committed loan facility – such as a project financing – to compensate them for the capital which they need to set aside on the unused portion of a committed transaction. In project financing transactions this commission tends to be in the range 30-40% of the Margin. The commission is collected in arrears on the unused amount of the facility, usually every 3 or 6 months.