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Article 24: Assessment of the Creditworthiness and Due Diligence of the Institutional Beneficiary
Date(g): 1/12/2021 | Date(h): 26/4/1443
Status: In-Force
1-
The Debt-Based Crowdfunding Company shall check and document the credit record of the Institutional Beneficiary after its approval.
2-
Upon the Institutional Beneficiary’s approval, the Debt-Based Crowdfunding Company shall register the credit information of the Institutional Beneficiary with one or more of the licensed credit bureaus in accordance with the relevant laws, regulations, and instructions. Such information shall be updated throughout the period of dealing with the Institutional Beneficiary.
3-
The Debt-Based Crowdfunding Company must decline the finance request in case of the absence of approval from the Institutional Beneficiary mentioned in paragraphs (1) and (2) of this Article.
4-
The Debt-Based Crowdfunding Company shall adopt clear, transparent and documented scientific methods, criteria and procedures to evaluate the creditworthiness of the Institutional Beneficiary and its ability to repay the debt. Such methods, criteria, and procedures shall be applied in accordance with the best practices in this field. The board of directors of the Debt-Based Crowdfunding Company shall approve these criteria and procedures, review them at least on an annual basis, update them when necessary, and document such updates.
5-
The Debt-Based Crowdfunding Company shall set clear policies regarding the Institutional Beneficiary due diligence in accordance with the Anti-Money Laundering Law and the Law of Combating Crimes of Terrorism and its Financing, their Implementing Regulations and relevant instructions. The Company shall also set identification criteria and initial due diligence for the Institutional Beneficiary. The due diligence framework shall cover at least the following:
a.
Verifying the legal status of the Institutional Beneficiary.
b.
Verifying the identity of the Institutional Beneficiary, including its establishment.
c.
Verifying the address of the Institutional Beneficiary.
d.
Ensuring that there is no conflict of interest between the Debt-Based Crowdfunding Company and the Institutional Beneficiary.
e.
Verifying the sufficiency of the Institutional Beneficiary’s resources to carry out the activity, including its solvency, credit history, and past performance.
f.
Assessing the Institutional Beneficiary’s business or financing levels (if any) and the existing financing and its source.
g.
Assessing the business plan of the Institutional Beneficiary.
6-
Without prejudice to the provisions of the relevant laws, the Debt-Based Crowdfunding Company shall inform Participants of the results of the due diligence procedure in the risk assessment process.
