Risk Framework

Multi-layered risk framework - due diligence, structural protections, monitoring, and default management

Port's risk framework ensures every Market on the platform has been independently evaluated, properly structured, and continuously monitored. The framework operates across four layers: pre-launch due diligence, structural protections, ongoing monitoring, and default management.

Port finances two distinct counterparty types — Originators (intermediary platforms that source, underwrite, and service pools of credit assets) and Trading Enterprises (direct borrowers accessing financing for their own working capital, receivables, and inventory). The risk framework applies to both but with important differences in evaluation focus, servicing model, and monitoring approach.

Pre-Launch Due Diligence

Every Market undergoes rigorous evaluation before launch, including credit analysis, operational due diligence, third-party risk assessment producing a published risk score, and independent legal and structural review. The scope differs by counterparty type: originator Markets are evaluated on portfolio quality and servicing infrastructure, while trading enterprise Markets focus on financial strength, trade flow verification, and counterparty creditworthiness.

See Pre-Launch Due Diligence for the full evaluation methodology.

Structural Protections

Multiple layers of protection are built into each Market's design to mitigate and absorb credit losses before they affect senior investors. These include counterparty-retained first-loss tranches (typically 5–20%), advance rate buffers creating over-collateralization, concentration limits enforced at drawdown, covenant frameworks with escalation triggers, insurance coverage where applicable, and SPV ring-fencing of facility assets.

See Structural Protections for detailed calibration and enforcement of all structural parameters.

Ongoing Monitoring

Throughout a facility's life, Port provides continuous portfolio surveillance, credit monitoring, and covenant compliance verification. The servicing model differs by counterparty type: originators manage day-to-day servicing with Port oversight, while Port often services trading enterprise facilities directly. Counterparties submit regular reports (or integrate via API), and periodic credit reviews reassess each Market's risk profile.

See Ongoing Monitoring for the full monitoring methodology, reporting cadence, and credit review process.

Default & Recovery

If monitoring reveals credit deterioration or a counterparty fails to meet its obligations, Port's escalation and recovery framework activates. This includes a three-stage escalation process (amber triggers, red triggers, events of default), defined recovery procedures tailored to each counterparty type, and a loss waterfall that protects senior investors through multiple layers of credit enhancement.

See Default & Recovery for the full escalation process, recovery procedures, and loss waterfall.