Protection through strict credit control procedures
The insurance (in certain circumstances) has been arranged to mitigate likely known risks to Marketlend through the establishment of strict credit control procedures from the application process through to the collection of a debt on default. The process is as follows:
- All credit applications received from the applicants are validated by Marketlend using verification processes.
- Information is confirmed by detailed Mercantile Report including all publicly available information on the buyer/borrower, as well as current and historical information on directors.
- Once validated, and depending on the size of the credit limit request, the application is processed for approval to the Insurer and then logged on the Marketlend system.
- Marketlend's automated risk assessment tool will risk assess the loan and place the loan on the platform.
- On receipt of a default notification, the system administrator will place the account on stop and no further funds will be available to this borrower will be purchased.
Default reporting in detail
The borrower may receive different trading terms (in increments of 30 days) from different suppliers. However if the borrower fails to make payment via direct debit on the due date for the current amount outstanding and due for payment on the statement, then they will be registered on the default report. The borrower will pay default interest of 26% or 15 dollars per day. Furthermore their terms of the loan may be restricted after they are no longer in default, or they may be not able to use the loan facility at all.
Extra certainty through our Loss Reserve
“We believe in the robust nature of our investment evaluation service. As such, we commit to pay losses to the extent that we have invested in the loan before any Marketlend investor investment suffers a loss. However an Investor must be aware that if losses exceed Marketlend's investment, the Investor will suffer a loss or maybe all of the investment."
From inception, in addition to insurance (if applicable), a loss reserve is established to protect investors from possible loss. Marketlend uses its money to provide for the initial loss protection, and Marketlend invests with you. Marketlend's investment is ranked below investors if a loss occurs. This means Marketlend suffers a loss before any investor.
Additionally, a portion of the borrower's loan (1.5%) is kept at settlement, to cover the costs of enforcing the investors rights against the borrowers or debtors to recover funds.
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