Once a project is financed, every month October collects the payments to be reimbursed to the lenders. The money transferred can be rejected by the borrower's bank within the 5 working days after the date of direct debit transfer. If this happens, please find hereunder the different steps of our management of late payments:
Initial contact: the October Recovery Team calls the borrower and gives him / her 7 days to regularise the situation.
If the payment has not been regularised within the 7 days, the project is being transferred to our recovery partner. The separation phase is :
- Amicable debt recovery: the objective is to bilaterally recover the amount due. This phase can last a few weeks. The actions handled by our partner are: phone calls, send post letters and e-mails, send formal notice to pay, etc.
- Judicial recovery (if the amicable recovery has failed): the objective is to recover the debt by actions through the competent Court. This phase can last months. 2 factors are really decisive: the tribunal's decision (full, partial or non-payment) and the financial solvency of the borrower.
During these steps, that again can last months, October handles the relation with the recovery partner and informs the lenders with the actions taken and their results. Communication to lenders is done weekly during the amicable debt recovery and monthly during the judicial recovery.
How are late payment indicated in your Portfolio?
The status of every project is indicated in your Portfolio.
- Green: all the payments are in order
- Yellow: the payment is 30 days late or less (40% haircut)
- Orange: the payment is between 30 and 120 days late (80% haircut)
- Red: the payement is more than 120 days mate or is in judicial procedure (100% haircut)
This status affects your Portfolio yield. Find out more here.
Confidentiality of recovery updates
Information about the recovery procedure is only addressed to the concerned lenders and is confidential.
To what extent can the diffusion of information enclosed in our recovery e-mails be damaging for the lenders?
Judicial procedures are based on the principles of fair trial, rationality and fairness in the debates. If lenders were to say defamatory statements in public, going against the presumption of innocence or belittling the borrower, he/she could turn against them before the competent judge. More generally, all information publicly diffused by lenders can be used by the other party during the procedure.
It is not forbidden to discuss these subjects but one should bear in mind to stay factual and tempered in his/her sayings.