Article 3
Methodology for the calculation of the actual default rate of loans by risk category
1. For the publication of actual default rates of all loans in accordance with Article 20(1), point (b)(i), of Regulation (EU) 2020/1503, crowdfunding service providers shall calculate the simple averages of the observed 1-year default rate by risk category over the entire historical observation period using non-overlapping 12-month observation windows.
2. For the calculation of the 1-year default rate by risk category, crowdfunding service providers shall ensure all of the following:
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(a) |
that the denominator consists of the number of non-defaulted loans observed at the beginning of the 12-month observation period within the risk category for which the default rate is calculated; |
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(b) |
that the numerator includes all loans considered in the denominator that had at least one default event during the 12-month observation period. |
3. For the purposes of paragraph 2, loans for which no payment is scheduled in the payment schedule during the 12-month observation period shall be excluded from the data set used to calculate the default rate for that period.
4. For the purposes of paragraph 1, irrespective of whether a crowdfunding service provider is using external, internal, or pooled data sources, or a combination of the three, the length of the underlying historical observation period used shall be at least 36 months for at least one source. Where the available observation period spans a longer period for any source, that longer period shall be used. A crowdfunding service provider that has been in operation for less than 36 months it shall use the period over which it has been in operation.
5. Crowdfunding service providers shall disclose the denominator and numerator used to calculate the actual default rate of all loans by risk category in accordance with paragraph 2 for the period determined accordance with paragraph 4.