HYDERABAD: Stumping up money for a film project can be quite a task. This is where film financiers come into the frame. A film producer’s necessity for big money is met by financiers, who lend at not less than five per cent interest per month. However, there is a flip-side. Failing to repay the money can lead to the financier stopping the film’s release or threatening the producer with goons.
Sources in the film industry say that around 90 per cent Tollywood movies are made using financier’s money. Even big producers like Allu Aravind and D Ramanaidu make movies by pooling money from financiers, since they do not want to risk their own money. “Financiers lend money usually at an interest of up to seven per cent per month. However, if a producer is close to a financier, the rate may come down to five pc,” a producer said.
The rules of the film financing business depend on how big or small a producer’s reputation is. A big-time producer is expected to repay the loan anywhere between three and nine months from the date of movie release. “It all depends upon the personal rapport a producer has with the financier. It is this faith on which crores of money are circulated in the film industry,” a financier said. Vijayanthi Reddy who was allegedly cheated by Singanamala Ramesh said, she gave him nearly `18 crore for production of a movie, without asking for any surety. In the 90s, Ramesh started off as a financier and lent money to producers. He found the business lucrative, as money could be lent for a huge interest. Having made money, he decided to turn into a producer but could not bear the losses. Having taken money from Vijayanthi, he was unable to repay and was on the run, before his arrest in Chennai on Friday.
Meanwhile, small-time producers are expected to repay the money at least one day before the movie’s scheduled release. Otherwise, the print of the movie might be stopped from reaching theatres by the financier. “We cannot take risks with small producers by giving time after release of the movie since in most cases, the movies do not do well commercially. Besides, once a movie flops, the producer is in no position to repay,” a financier said on the condition of anonymity. Another course of action with financiers is resorting to intimidating producers who default on their payment. Vijayanthi Reddy was intimidated by Bhanu Kiran, a close aide of the murdered faction leader Maddelachervu Suri, at the behest of Singanamala Ramesh.