The Borrower and the Loans
The borrower received four loans through our platform:
| Loan number | Loan amount | Issuance date | Interest | Term | LTV | Collateral |
|---|---|---|---|---|---|---|
| PL0000869 | 8 325 EUR | 2022-08-11 | 13.00% | 36 months | 51% | Heavy equipment |
| PL0000870 | 5 230 EUR | 2022-08-11 | 13.50% | 36 months | 50% | Implements |
| PL0000871 | 44 165 EUR | 2022-08-11 | 15.14% | 36 months | 70% | Tractor |
| PL0001158 | 82 000 EUR | 2023-01-26 | 14.52% | 36 months | 85% | Land |
For nearly two years, the borrower made regular repayments. However, after 21 months, in June 2024, payments on all loans completely stopped.
What Went Wrong?
When we reached out, the borrower explained he was facing serious financial difficulties due to delayed and reduced agricultural subsidies. This significantly impacted the operations of his farm. Understanding the seasonal and cash-flow-sensitive nature of agriculture, we granted a grace period till after the harvest to allow him time to recover. Unfortunately, no further payments were made.
Our Response
Once it became clear that payments would not resume voluntarily, we initiated our formal debt recovery process:
- All legal payment reminders and notices were issued.
- As of May 23, 2024, the borrower was added to the National Register of Debtors in Poland.
- The loan agreements were officially terminated.
At this point, the most straightforward path would have been court enforcement. However, that route often comes with high legal fees and delays that can stretch into years. Instead, we explored a more collaborative solution.
A Different Approach
Drawing on our experience, we proposed a settlement agreement in which the borrower would voluntarily submit to enforcement. While initially hesitant, the farmer agreed – recognizing that this would allow him to avoid immediate legal proceedings.
During this time, we advised the borrower to contact a Polish government agency that supports farmers in financial difficulty. We helped him prepare the required documents and guided him through the entire application process.
This wasn’t easy. It required:
- Multiple rounds of detailed financial analysis
- Close coordination with both the borrower and the institution
- Ongoing monitoring and communication to ensure all criteria were met
This process took approximately four months.
The Result
Thanks to this approach, the borrower remained cooperative, and the overdue amounts were successfully repaid in full – without the need for court enforcement. This outcome preserved our relationship with the borrower, avoided legal costs, and accelerated recovery compared to standard litigation (which could have taken over a year).
The only trade-off was that interest could only be recognized up to the last day of the month prior to submitting the government aid application. This was a small cost compared to the benefit of full principal recovery.
Final Return for Investors
Investors received their principal back and a significant portion of the interest earned over nearly two years. While the loans were in default for up to 440 days – the debtor repaid the loans faster than initially anticipated and the return for investors was higher than the interest rate they invested for.
This case reflects our commitment to recovering funds effectively, while also handling situations in a human, efficient way that avoids unnecessary conflicts.
| Loan number | Loan amount | Repaid amount | Repayment date | Repaid in | Factual return* |
|---|---|---|---|---|---|
| PL0000869 | 8 325 EUR | 10 737 EUR | 2025-06-06 | 34 months | 15.16% |
| PL0000870 | 5 230 EUR | 6 694 EUR | 2025-06-05 | 34 months | 14.82% |
| PL0000871 | 44 165 EUR | 56 630 EUR | 2025-06-06 | 34 months | 15.13% |
| PL0001158 | 82 000 EUR | 104 211 EUR | 2025-06-06 | 29 months | 15.06% |
*Factual return is calculated as XIRR, which accounts for both how much and when money goes in and comes back — earlier returns boost factual return more than later ones.
