How your investment is protected: collateral and the claim purchase structure

Every project on CrowdHive pays between roughly 10% and 17% net per year. Returns like that only exist because real risk exists alongside them. This article explains, layer by layer, what actually stands between your money and a borrower who stops paying: the collateral behind each loan, and the legal structure that makes your claim enforceable. Just as importantly, it explains what these layers do not do. There is no deposit guarantee here, no insurance, and no promise that capital cannot be lost. Understanding both sides is the point.

The legal foundation: you hold a real claim

Before talking about collateral, it helps to understand what you actually own when you invest through CrowdHive. The platform is operated by BellaVista Invest One AG, a Swiss company and a Member of SRO VQF, a FINMA-recognised Self-Regulatory Organisation, supervised under Article 24 of the Swiss Anti-Money Laundering Act.

The structure works in two steps. First, BellaVista Invest One AG issues a loan to the borrower, which is always a legal entity, never a private individual. Second, when you invest in that project, you enter into a Claim Purchase and Assignment Agreement: the company sells and assigns to you a portion of its claim against the borrower, in proportion to your contribution. This agreement is signed per project, not as a blanket arrangement, so each investment you make corresponds to a specific, identifiable claim against a specific borrower.

Why does this matter? Because it means you are not holding a vague promise from the platform. You are the legal holder of a loan claim under Swiss law. The company remains the servicer of the loan and, as we will see below, acts as Collateral Agent on your behalf if things go wrong. But the claim itself is yours.

Collateral behind each project

CrowdHive projects are structured as collateral-backed lending. Assessing the security behind each loan is part of the review every project goes through before it reaches your feed. If you want to see how that review works end to end, read how CrowdHive due diligence works.

A key practical detail: the collateral is not split into small pieces among investors. BellaVista Invest One AG holds the security interest on behalf of all investors in a project, in its role as Collateral Agent under the Debt Collection Procedure Agreement. This is what makes enforcement workable. Instead of dozens of individual investors each trying to enforce a fraction of a pledge, one party holds the security and acts for everyone at once.

Collateral is the first line of defence, but it is worth being honest about its limits. Realising security takes time, its market value at the moment of sale can differ from its assessed value, and enforcement proceeds may not cover the full amount owed. Collateral reduces risk. It does not remove it.

Where repayment actually comes from: the first projects

Collateral is the fallback. The primary protection is always the borrower's ability to repay, which is why every project on the platform is underwritten around a defined repayment source. The first projects on CrowdHive, all in Latin America and all paying 17%, illustrate the main categories:

• Portfolio receivables. A Singapore-based fintech expanding into Mexico repays its loan from the collections of the consumer, SME and factoring loan portfolio the financing is used to build.
• Contracted client payments. A Brazilian engineering and construction contractor building a new data hall repays from staged payments under an already signed customer contract worth several times the loan amount.
• Operating cash flow from existing clients. A Paraguayan IT integrator building data center capacity repays from revenue generated by serving clients it already has.
• Sale of a completed asset to a committed buyer. A Paraguayan developer of power-ready sites repays from the sale of the finished facility to a specific buyer under a purchase agreement signed in advance.

These are all bullet loans: interest is paid during the term and the principal comes back in a single payment at maturity, which concentrates repayment risk at the end of the loan. We explain what that means for investors in bullet loans explained, and why these markets pay these rates in where 17% yields come from.

Collateral reduces risk. It does not remove it.

What happens when a borrower defaults, step by step

The default process is not improvised. It is set out in the Debt Collection Procedure Agreement, which every investor enters into together with the platform terms. The sequence looks like this:

1. Notice. When a payment is missed, the borrower receives formal notice of the breach.
2. Grace period. The borrower is given a defined window to cure the missed payment. Many delays end here.
3. Acceleration. If the default is not cured, the loan can be accelerated, meaning the full outstanding amount becomes due immediately, not just the missed instalment.
4. Collateral realisation. BellaVista Invest One AG, acting as Collateral Agent for all investors in the project, enforces the security and pursues collection from the borrower.
5. Distribution. Recovered funds are distributed in a defined order: enforcement fees and costs first, then outstanding interest, then principal, shared pro-rata among the investors in the project.

The practical consequence for you: you never have to sue a borrower yourself. You do not hire a lawyer in another jurisdiction or coordinate with other investors. Collection is run centrally, professionally and collectively, which is cheaper and usually more effective than fragmented individual claims. One boundary to note: the company is responsible for properly executing the collection procedure, but it is not liable for the borrower's default itself.

What this protection does not do

An honest summary of the limits, in one place:

• No deposit guarantee. CrowdHive is a crowdlending platform, not a bank. Funds on the platform are not covered by esisuisse, the Swiss deposit insurance scheme, or by any comparable protection scheme.
• No FINMA supervision of the platform itself. BellaVista Invest One AG is supervised by SRO VQF under Article 24 AMLA. FINMA recognises VQF; it does not directly supervise the platform, and SRO membership concerns anti-money-laundering compliance, not investor compensation.
• Capital loss is possible. If enforcement proceeds fall short of the outstanding debt, investors bear the loss on the remainder.
• Recovery takes time. Enforcement is a legal process. During it, your money is not accessible.

Layered protection is exactly that: layers, each with a defined job and defined limits. Collateral gives your claim something to stand on. The claim purchase structure makes your position legally real. The Collateral Agent role means enforcement is handled for you. None of these layers, alone or together, turns lending into a risk-free product, and no serious platform should tell you otherwise.

Investing involves risk, including the possible loss of capital. Past performance is not indicative of future results. BellaVista Invest One AG facilitates lending to businesses and does not provide investment advice.