An institution, usually non-profit, that exists with the purpose of financially supporting film projects. Films are supported by either production loans or stipends deisgned to offset production costs. In Germany, these exist in many cases as regional Film Funding entities supporting regional projects (e.g. FilmFernsehFonds Bayern (Bavarain Film and TV Fund), Medienboard Berlin-Brandenburg) (Berlin Media Board) and National Film Funding Organizations (e.g. the German Federal Film Board FFA, Kuratorium junger deutscher Film) German Youth Film Committee.
The goal of such film development funds is to promote culture and to seed economic growth. These specific investment objectives depend on the various kinds of institutions themselves. Note: film investment is mostly private in the US. Funding choices are made based on Project proposals (screenplays, proposed budgets, etc.) from filmmakers.
For the most part, film funding takes place in the form on a loan that is based on the commerical potential of the film. If the film is not sucessful and does not return a profit then the loan repayment obligation is suspended. In this case, the loan is reclassified as a grant / subsidy. A smaller part of the Film Funding system is provided directly to filmmakers as grants that need not be repaid.