Investing in loans on Afranga involves certain risks. While Afranga performs strict due diligence on all borrowers and loans, investors should be aware that no investment is without risk.
KIIS – Your Risk Disclosure Resource:
Every loan listed on Afranga includes a Key Investment Information Sheet (KIIS) — a standardized document that contains:
- A breakdown of the specific risks associated with the loan
- Financial and operational details about the borrower
- Information on loan structure, repayment schedule, and investor rights
You should carefully review the KIIS before investing to understand the full risk profile of each loan.
General Risk Factors:
- Credit risk: The borrower may fail to repay the loan on time or in full.
- Liquidity risk: You may not be able to sell your loan on the secondary market quickly or at the expected price.
- Platform risk: If Afranga ceases operations, loan servicing will be handled by an appointed administrator, but delays may occur.
- Economic risk: Broader economic or geopolitical events could impact borrower performance or loan markets in general.
- Withholding tax risk: Depending on the country of the loan originator, different withholding tax rates may apply, potentially impacting your net returns.
Summary:
Loans carry inherent investment risks, including credit and liquidity risks. Afranga helps mitigate these by screening borrowers and providing transparent documentation such as the KIIS. Make sure to evaluate each loan and diversify your portfolio accordingly.
Need help assessing risk? Reach out to us at support@afranga.com.