Blender After P2P: What Is Left Of The Security Fund And How Orderly The Runoff Can Be

The main article already argued that Blender's strategic turn now runs through BNPL and its broader credit-services layer. This continuation isolates the legacy thread left behind: what actually happens to the P2P platform after new loan originations stop, and what that means for the security fund, for investors, and for the odds of running the book off without letting this tail keep weighing on the whole story.

The short answer is sharper than the shutdown headline. P2P did not disappear. At the end of 2025 the brokered-credit book still stood at NIS 381 million, and the company committed to keep managing and operating it fully until runoff. But the security fund, which was meant to smooth payments to investors when loans moved into deep delinquency, had already been depleted by the report date. From January 2026 investors were no longer receiving full payments, only partial payments based on whatever cash was available on each payment date.

• The bottleneck is no longer growth, it is liquidity. The annual report states explicitly that the security fund relied on two current cash sources: deposits tied to new loans and proceeds from collection procedures. Once new originations stopped, one of those two legs disappeared.
• The runoff can be orderly operationally, but not clean financially. The P2P book declined gradually through 2025 from NIS 435 million to NIS 381 million, and the company continues to service it, but investor payments now depend on collections and insurance proceeds.
• The 3.5% figure does not close the file. The company itself says this is an after-collection estimate and that its default-calculation policy does not include expected future defaults.
• The legal tail remains open. In December 2025 a motion for class-action certification was filed against Blender P2P Israel around fees and management charges, and the company still says it cannot assess the odds.

What Is Left of the Security Fund

Blender describes P2P as a platform with five protection layers for investors, but at this stage those layers do not carry equal weight. What matters now is no longer underwriting, diversification, or the secondary market. It is the mechanism that bridges the gap between delinquent borrowers and the monthly cash flow expected by investors. The center of that mechanism is the security fund.

The company defines the fund as an accumulated indemnity fund financed by dedicated deductions from investors' money and from borrowers' loan proceeds. As of the report date it is intended to cover principal payments to investors in loans that are four or more installments overdue. So this is not a theoretical cushion. It is a structure meant to advance real cash.

This is the point a reader can miss if they stop at the headline about shutting the activity. In the default-calculation section, the company writes plainly that for current payments the security fund relies both on deposits generated by new loans and on proceeds from collection procedures. As long as the system keeps originating new loans, both cash pipes operate together. Once the company stops making new loans, the first pipe closes. That is why the key question is no longer only how large the book still is, but whether collections and insurance can actually replace the support that used to come from fresh originations.

The report also defines the insurance layer in a way that requires caution. The policies cover 15% of the insured credit damage, net of a 4% to 6% deductible depending on the origination year. This is not a policy that fills the whole hole. It is a partial shock absorber, and it still depends on claims and collection dynamics rather than immediate cash.

The sharpest sentence comes two pages later. Until December 2025 the security fund paid investors their monthly payments in full. After those payments, according to the report, the fund balance was depleted, and by the report date no balance remained, before future collections and insurance proceeds. From January 2026 the fund has been making only partial payments to investors according to the cash available on each payment date. At that point the issue is no longer model quality. It is cash on hand.

Why the Runoff Can Be Orderly, But Not Smooth

There is also a reason not to jump too quickly to a conclusion of chaos. The investor presentation shows that the P2P book did not collapse overnight. It eroded gradually through 2025, from NIS 435 million at the end of 2024 to NIS 423 million in the first quarter, NIS 409 million in the second, NIS 390 million in the third, and NIS 381 million by year-end. In addition, both the annual report and the January 2026 immediate report state that the company will continue to manage and operate the existing book fully until runoff. In other words, this is not an instant fire sale. It is a long endgame.

That matters because orderly runoff is first and foremost a servicing, collections, and operating question. If the book had broken all at once, the operational risk would be much higher. Here, the book reached January 2026 only after a year of gradual decline, which helps explain why management frames the move as part of a strategic refocus rather than only as an admission of failure.

But this is exactly where the reading has to stop itself from becoming too generous. Orderly is not the same as smooth. That same gradual decline in the book did not prevent the security fund from being depleted. Quite the opposite. The company itself explains that the fall in new originations, together with the restrictions imposed in 2024 on collection procedures because of the war, is what eroded the fund. In the risk section, it also classifies "security fund liquidity" as a company-specific risk with high impact. So inside the report itself this is not presented as background noise. It is presented as a material risk.

Another important point comes from combining the P2P revenue model with the half-year slide. Blender states that in P2P it charges both borrowers and investors for loan setup, management, and servicing. In the presentation, in the second half of 2025, gross revenue in the brokered-credit segment fell only modestly to NIS 26.8 million from NIS 28.2 million in the second half of 2024, net revenue actually rose to NIS 8.5 million from NIS 7.4 million, and segment profit rose to NIS 2.75 million from NIS 297 thousand.

That is especially important for how the market may read the story. A runoff activity can keep producing revenue and servicing fees even after new originations stop, so the P&L can still look reasonably stable for a while. But investor cash flow is no longer supported by the same cushion. Anyone looking only at segment profitability could miss that the friction has shifted from the accounting line to the liquidity and trust layer.

The 3.5% Number Does Not Close the File

The report also offers investors a number that can create comfort too quickly. Blender writes that it calculates the default rate as total debtors, less expected future collections and less payments made by the security fund, divided by total credit originated since inception. On that basis it estimates that as of December 31, 2025 total debt in default after collections would stand at about 3.5%.

On the surface that sounds fairly definitive. That is the wrong read. In the same section the company adds that this default-calculation policy does not take expected future defaults into account. So 3.5% is not a full estimate of the total runoff cost still ahead. It is a point-in-time estimate that already nets out expected future collections from the currently delinquent layer, while excluding what may still deteriorate later on.

That does not make the number meaningless. It still says the company believes the ultimate damage after collections may remain relatively limited versus cumulative originations. But it does mean this is not an end-state figure one can safely use as a ceiling for the entire tail loss. In analytical terms, it is much closer to an estimate for the current delinquent pool after assumed collections than to a full remaining-life loss estimate.

The link to the security fund makes that even sharper. As long as the fund could keep paying in full, the 3.5% figure could mostly be read as a measure of final collection quality. Once the fund was depleted and partial payments began in January 2026, the question stopped being only what the eventual default rate will be. It also became a question of when the money arrives, how regularly it arrives, and how much of that waiting period is pushed directly onto investors.

The Legal Tail Means This Will Not Stay Only a Collections Story

This is where the legal layer enters. On December 24, 2025 a motion for class-action certification was filed in the Tel Aviv District Court against Blender P2P Israel. According to the note, the motion includes claims regarding the collection of fees and/or management charges allegedly above what was permitted under the engagement agreements, and claims that fee or management-charge tariffs were changed and increased during the life of existing loans. As of the report date the subsidiary had not yet filed its response, and the company says it cannot estimate the chances of the motion.

The report also does not yet allow a quantified cash reading of that process. But it does change the character of the remaining P2P tail. The issue is no longer only a loan book that needs to be collected and a security fund that needs liquidity. It is also a fee dispute tied specifically to the platform that has now entered runoff. When that is combined with the fact that investors are no longer receiving full payments, it becomes clear why P2P may continue to occupy management attention and market perception even after new loan originations have stopped.

The analytical implication is straightforward. Blender can fairly argue that P2P is no longer at the center of its growth engine. But it still cannot present it as a quiet tail. As long as the fund is empty, collections and insurance are carrying the monthly flow, and a legal dispute around fees and management charges is also in the background, P2P remains a full legacy-risk package, not merely a closed activity line.

Conclusion

The right read of Blender after the P2P stop is not "the activity is over," but "the activity has shifted from a growth engine to a servicing and recovery engine." That is a large difference. It means the runoff can be relatively orderly operationally because a large book still exists and the company has not abandoned it. But it also means that order now rests on narrower, slower, and less certain cash sources.

Current thesis in one line: Blender's P2P book may close in a controlled way, but not in a clean way, because the hard part has shifted from credit origination to security-fund liquidity, collection speed, insurance proceeds, and the legal tail.

What will change the read over the coming quarters is not the fact of the shutdown itself, but the quality of the runoff. If the book keeps shrinking gradually, if partial investor payments begin to lean more on actual collections and insurance inflows, and if the legal layer remains contained, then the legacy risk will genuinely begin to contract. If not, Blender may discover that even after a growth engine is shut, its tail can keep sitting on the equity story much longer than the first headline suggests.