🦺DecentraCredit Escrow Services
Last updated
Last updated
Apart from being a facilitator between a Lender and a Borrower, DecentraCredit ensures safe-keeping of user funds as well, enabling it to create a trust-less mechanism.
DecentraCredit works as an Escrow service to ensure safety and security for both lenders and borrowers. Every collateral goes into an Escrow Vault when a loan is executed. This collateral is freed from the Escrow Vault only when the loan is fully repaid. Otherwise, if the auto-liquidation condition is met, this asset is released from the Escrow Vault and sold at the market price. The outstanding loan amount is settled with the lender and the remaining, minus the platform charges, is sent back to the borrower, if any.
Thus, DecentraCredit ensures neither the lender can run away with the expensive collateral of the borrower nor the borrower can delay the repayment indefinitely.
Accepting Collateral from the Borrower during a loan disbursement.
Releasing Collateral back to Borrower after successful repayment of the loan.
Liquidating Collateral if Liquidation Ratio is triggered.
Liquidating Collateral if Loan Duration is over.
In the last two scenarios, the platform also manages closing the outstanding loan automatically and sending leftover funds to the borrower.
