With growing concerns over online delinquency (P2P) loan delinquency rates, Tera Funding, the industry's No. 1 in terms of cumulative loans, exceeded 20%.

Due to the nature of peer-to-peer transactions, investors should be warned that the loss will have to be passed on to the investor if the borrower does not pay it back on time.

According to data released by Terra Fund on the 2nd, Tera Fund's delinquency rate was 20.18% last month. It rose 7.21 percentage points in half a year from 12.97% in December last year.

Terra Funding is based on real estate P2P financing, which connects construction companies and individual investors.

Since the amount of loans per case is larger than that of personal credit loans, if there is a problem with a specific product, the structure of the loss increases.

Tera Funding's delinquency rate soared to 20.18% as overdue occurred in 15 project financing (PF) lending real estate construction funds.

If the delinquency rate exceeds 20%, risk management measures should be prepared and reported when registering as a P2P company with financial authorities after the Act on the Protection of Online Investment-Linked Finance and Users in August.

This is because P2P companies have imposed obligations for each section of the delinquency rate to reduce the damage to investors caused by handling loans with high risk of overdue and default.

If the delinquency rate exceeds 10%, some business methods should be restricted, and if it exceeds 15%, it should be disclosed.

An official from Terra Funding explained, “The real estate economy has deteriorated, and in order to reduce the loss of investors, it is a principle to collect by itself without selling bonds as much as possible.

In addition, he said, "We are doing our best to manage the bonds by increasing the number of external managers to the credit management team." We are also strengthening our ability to reduce the frequency of overdue through the recruitment of appraisers and pre-sale experts."

(Yonhap News, Photo = Yonhap News)