Fixed-income investments are not risk-free.nbsp; Different fixed-income investments come with different risk types.nbsp; In the case of IndiaP2P, the risk to your returns comes from the possibility of borrowers whose loans you have invested in defaulting i.e. not repaying.nbsp;nbsp;
This type of risk is common to all investments in lending whether the lending is done by a bank or investors like yourself via IndiaP2P.nbsp;
For the borrower segment IndiaP2P sources loans, historical default rates also called NPA (Non-Performing Assets) can be seen here.nbsp; It should be noted that historical default rates only indicate the quality of loans sourced and do not guarantee future performance.nbsp;nbsp;
While we source high-quality loans, we further reduce the risk of loss from potential defaults by fractionalizing loans as explained earlier.nbsp; nbsp; Fractionalizing limits exposure to a borrower and also enables your investment to be diversified over borrowers from different geographies, income sources etc. This diversification adds another layer of risk reduction on your investment.