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What happens when an SME borrower defaults on a loan
What happens when an SME borrower defaults on a loan
Written by Summer Lee
Updated over a week ago

Although BRDGE makes a significant effort in keeping the risk of loan default to a minimum, all loans have an inherent amount of risk; investors may lose their entire investment.

BRDGE has a borrower default process in place to manage the situation as soon as possible by working with the business borrower to understand the reason behind the default. Primarily, we would like to reach an amicable solution with the borrower to protect the interests of the investors.

BRDGE has a set of legal mechanisms and contingency plans in place to mitigate such risks. After 90 days of non-payment and non-response from the borrower, BRDGE will gather the investors and update them on the string of actions that we intend to take.

During the meeting, all the cost will be made transparent to the Investors and we will proceed with the necessary actions only if majority investors present at the meeting consent to them. That withstanding, we highly encourage our investors to understand the due diligence risk and nature of each proposed funding clearly to make a sound investment decision.

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