How the pool is funded
A pool holds $10M of receivables. The originator deposits $1.5M of its own money — 15%. A bank advances $7.5M. The remaining $1M is what PRISM raises from investors.Who absorbs a loss
If the pool loses $400,000, the originator absorbs all of it. Investors lose nothing. The originator would have to lose its entire $1.5M before pALPHA is touched at all. The table below reads off the attachment points. It shows the order in which capital is destroyed, not a forecast of what will happen.The 4% figure used above is PRISM’s expected loss rate. It has never been
measured against real data and is a placeholder. See Disclosures.