Trust and Retention Account

Trust and Retention Account

A typical process of asset securitization involves sale of specific receivables to a Special Purpose Vehicle ("SPV"). While globally different forms of entities are used as SPVs, in India trusts make up the most popular form of SPV structure.

• Manage future cash flow of the project independent of borrowers’ intervention
• Protect the project lenders against the default risk by insulating the cash flow of the project
• Monitor utilization of project funds by borrower from TRA account as per the terms