A loan is marked as non-performing if a borrower misses an interest payment and it remains outstanding for more than 45 days, but has not yet defaulted. Landbay may cover the missed interest on a discretionary basis using the reserve fund (this would appear on your classic account statement as a "Reserve fund payment"). Please note that investors cannot sell their loan parts in a non-performing loan on the secondary market to other investors.
When a loan falls into arrears, our servicing team will liaise with the borrower to make them aware the payment is overdue and understand why it was missed, and establish a process to collect the outstanding interest due.
If the account is not brought up-to-date and the loan defaults then enforcement action takes place. For more information on borrower default please see our page on What are the risks of investing?