Recommendations for lenders
The Debt Service allows WebMoney Transfer System members to lend each other WMZ title units subject to conditions of refundability, time limitation and repayment without intermediaries.
WebMoney Transfer System does not charge fee for the Debt Service usage.
What is a trust limit¶
Trust limit (or credit line) is an Offer to conclude Loan Agreement accepted by two WebMoney Transfer System members on conditions that include:
- maximum loan amount;
- maximum disbursement period;
- manner of credit repayment;
- daily interest rate for funds usage;
- purse number from which funds will be granted.
The offer to set a trust limit is sent by the Lender to the address of a potential Debtor who can accept or decline it. Accepted offers are authenticated with analogues of signatures of the parties in accordance with WebMoney Transfer System algorithms.
Who can grant a loan on the Debt Service¶
On the Debt Service granting loans by setting trust limits can be performed by any member of WebMoney Transfer System who has:
- a formal or higher passport with a verified phone number;
- a WMZ-purse with the amount of funds sufficient to grant a loan.
How to grant loans on the Debt Service¶
The process of granting a loan consists of four steps.
Step 1. Choose a debtor. As a rule the Debtor should be personally acquainted with you. You should know their financial position and reputation, location and contact information, as well as means of claiming the debt in case of non-repayment.
Most likely you are in long-term business relations with the Debtor and they are present in your correspondents list in WebMoney Keeper.
However Loaners often wish to place their spare funds for a fee by granting loans to unacquainted Debtors, who posted requests to receive loans on the Debt Service. For that one should choose a suitable request on the corresponding section and contact a potential Debtor.
If you did not find a request with suitable conditions you can place your own offer with loan granting conditions and wait until Debtors turn to you.
Step 2. Open a credit line (trust limit) specifying the interest rate for funds usage, maximum amount and disbursement period, and wait until Debtors contact you. Obtain Debtor's consent with the terms of a trust limit.
Step 3. Grant funds from your purse. After the credit line is opened the Debtor can transfer an amount of funds from your purse within the bounds of the set trust limit.
Step 4. Repay the loan. On the term's expiration the Debtor repays the loan and the interest.
Debt service allows as well:
- repay the loan prematurely;
- repay the loan at the lender’s initiative, including partial repayment at the expense of other credit lines of the Debtor.
How to choose Debtors¶
Selection and evaluation of the Debtor is the most significant step of the process of granting any loan. This step is specifically important on the Debt service.
Note that the Debt service only gives the interface for drawing up and fair execution of the Loan Agreement. The loaner completely assumes all risks and responsibility for the decision on granting a loan. This is why the Loaner should:
- verify Debtor's identity and postal details on their own;
*assess the risks and possible consequences of the Debtor's non-performance of the Loan Agreement.
Creditor is recommended to have debt relations only if:
- the Loaner is personally acquainted with the Debtor;
- Debtor's identity is verified by the documents;
- the Loaner is informed of the Debtor's place of residence and financial position as well as of the loan purpose and sources of loan repayment.
With the consent of a potential Debtor you can obtain the data provided by WebMoney Transfer System to evaluate their identity and business reputation on the basis of registration data and operations history. This may concern any member of the System whether you are acquainted with them or not.
1. Examine the passport of a potential Debtor.
A fair Debtor generally provides personal information that is detailed enough.
Make sure that you know the real name, phone number and place of residence of a potential Debtor in addition to their alias and web details: this information should be publicly available in their passport.
Be sure to check the authenticity of the potential Debtor's postal details and phone number. There is a service for postal detail verification in the WebMoney Transfer System (verification is performed by sending a regular letter to the address specified by the member). Try to deal only with the members who have verified postal details.
Take into consideration that the WebMoney Transfer System Passport Service has at their disposal only the notarized signatures examples of those members who has Personal passport or higher.
2. Examine the Debtor's application
As a proof of their creditworthiness any Debtor can provide the information about their financial position, income rate, education and marital status by filling out the loan borrower application.
Examine it carefully and critically.
It is important to understand that each statement in the application is declarative, and it might be as well for you to get a confirmation of the information from a third party.
The loan borrower application in full or its particular statement can be approved by another member of the System who guarantees the trustworthiness of the information.
Doubt the guarantees as well by examining the identities of the guarantors.
3. Check the Debtor's rate of business activities in the WebMoney Transfer System.
Each member of the System has their unique Business Level (BL). This characteristic is calculated considering the volume of successfully completed transactions between them and other users of the System, business activities stability and experience of using the System.
BL of a WebMoney Transfer System member is a normalized characteristic that indicates volume and amount of funds received by the owner of a WMID from other members without receiving claims and complaints .
BL can possess a value between 0 and 10000. Newcomers usually have BL of 10-50 points during the first year of using a WMID. Note that a zero BL indicates the lack of experience of using the system or the suspension of this WMID.
Always pay attention to:
- BL level;
- passport type and the method of its issue;
- registration date.
4. Check the Debtor's trust level.
WebMoney transfer system interfaces allow the members to establish correspondent relations with each other which includes: sending messages, title units and invoices, browsing operations history and even entrusting to carry out operations with each other’s purses within preset limits.
The most valuable parameter for evaluating mutual trust in WebMoney Transfer System is “trust limit” – a volume of title units on a specific purse which accessible for other members in automated mode.
Set trust limits can be:
- provided – if the amount of funds on the lender’s purse is equal or exceeds the volume of the limit;
- not provided – if the amount of funds on the entrusted purse does not cover the volume of the limit.
The amount of all provided trust limits set for a specific member by their correspondents is calculated by the System and is a public parameter – TL (trust level).
TL value indicates the amount of WMZ title units that can be borrowed by a member from their correspondents on mutually agreed terms without preliminary notifications.
Thus TL level of a member depends on:
- number of correspondents who entrusted funds on their purses to them;
- volume of entrusted funds;
- volume of coverage on member’s correspondents’ purses.
Analyzing the TL of a potential Debtor take into account that ‘trust limit’ is an ‘instantaneous’ indicator: it is actual for the moment of calculation only.
At any time the lender can revoke a limit or change its parameters. The coverage from the lender’s purse can be decreased or transferred in full. At the same time, in spite of its unstable kind, the analysis of TL value can inform the Lender significant information on the potential Debtor’s personality: number of their correspondents and expansion of their financial relations.
5. Examine the Debtor's credit history in the WebMoney Transfer System
When a potential Debtor adds you to their contact list (it is in the interest of a conscientious Debtor to provide you as much personal information as possible) you become able to see their contacts list, significant events in WebMoney Transfer System, their states in the services of the System (including the Debt service).
After fulfilling this list of recommendations which is nevertheless not exhaustive, it is necessary to contact the Debtor in person for clarifying their creditworthiness and assessing the purpose of the loan and repayment sources.
Risks taken by the loaner on the Debt service¶
There is a possibility of non-repayment, partial repayment or exceeding of the time limit for each granted loan.
The Loaner determines the admissible risk level for each granted loan.
Granting a loan by the means of the Debt service the Loaner should realize that WebMoney Transfer System does not take any risks and only provides interfaces for arranging loan deals and a number of instruments of influence on a loaner in case of non-repayment according with the Terms.
Note: despite the fact that banking business professionals’ work aims to assess and minimize the risks of granting loans, their activity is almost fully unprofitable on a long period of time and leads to negative results due to the accumulation of errors.
This is why you should not lend turnover funds - spare funds only.
When granting a loan you must take into account the most important feature of the Debt service automation - limited means of influence on a Debtor, and specifically:
- any influence is possible only within WebMoney Transfer System;
- absence of mechanisms of charging fines and penalties for violating the terms of loan repayment;
- Debtor’s responsibility comes to nothing more than a promissory note in the form of the Debtor’s electronically compiled unconditional obligations to pay, issued in accordance with the procedures of the Paymer Service on the double face value and transferred by the Debtor to the Debt Service for keeping at the moment of the receipt of the loan from the Lender.
the Arbitration of Webmoney Transfer System does not accept claims on loan agreements concluded by the means of the Debt service, since penalties and fines are not created for such agreements, and all possible actions for suspending of the Debtor can be performed by the Loaner himself by means of the instruments provided by the Debt service.
Ask as many clarifying questions as possible and make sure the Debtor comprehends the terms of using of the Debt service.
What to do if a loan is overdue¶
Both participants of the deal of lending are notified by the Debt service on the expiration of repayment time. In this case the Lender has to try to get in touch with the Debtor for inquiring the causes of the delay.
If it is impossible to contact the Debtor or if the explanations given by the Debtor does not suit the Lender, the latter has the possibility to temporarily suspend the activity of the debtor's purses in the WebMoney Transfer System. With that only purse funding and exchange to WMZ operation will be available for the Debtor until the loan is fully repaid.
What to do if a loan is non-repaid¶
If the Lender ascertains the Debtor's impossibility of implementing the conditions of the agreement, then, in case the Debtor’s TL is positive, the Lender can try to repay the loan at the expense of trust limits, opened for the Debtor by other members of the System. With that the loan will be repaid at the expense of the Debtor by concluding new lending agreements with other Loaners.
If the Debtor's TL is null or insufficient for covering the indebtedness of the loan, the Lender can obtain the Debtor's unconditional obligations of payment to the presenter in electronic form, drawn up according to paymer.com procedures with the double face value to the amount of debt stored for keeping on the Debt service. The given obligations conform with a hand receipt on their liability to pay the amount of debt to the presenter.
The holder of the obligation can:
- continue claiming the debt from the Debtor by presenting them these obligations (sending a repayment offer);
- sell the obligation to third parties on the Debt Mart;
- receive documents verifying the authenticity of the obligations and an analogue of Debtor's handwritten signature to demand the repayment outside of the WebMoney system (for example, through judicial authorities).
Learn more about the Debt Service functioning¶
Detailed manuals on the Debt Service usage can be found at WebMoney Wiki reference system.