# Redemption Provider

As a borrower in the EpsiLoan protocol, you have the option to provide Rigid Redemption services for your collateral assets. Here's how the Rigid Redemption process works and its impact on your collateral and debt:

1. Activation of Rigid Redemption Services: As a borrower, you can choose to activate the Rigid Redemption button, enabling other users to redeem your LRT assets in exchange for yUSD. By opting in as a redemption provider, you allow users to repay your debt and retrieve an equivalent amount of your collateral assets.
2. Effect of Redemptions on Collateral and Debt: During the redemption process, a portion of your collateral assets is exchanged for yUSD, reducing your debt accordingly. This reduction in debt is equivalent to the USD value decrease of your collateral assets.
3. Partial vs. Full Redemptions: Redemptions can either be partial or full, depending on whether they fully pay off your debt or only reduce it partially.&#x20;

{% hint style="info" %}
Partial Redemption Example (A): If someone redeems a portion of your lrETH collateral using yUSD, such as 2,500 yUSD, and the redemption fee is 1%, the provider receives 0.99 lrETH in return. This reduces your collateral from 3 lrETH to 2.01 lrETH, with your debt now at 2,500 yUSD. Consequently, your collateral ratio increases from 150% to 201%.

\
Full Redemption Example (B): In the scenario where someone redeems the full amount of your debt, such as 5,000 yUSD, your debt will be fully liquidated. The collateral is reduced accordingly, leaving you with 1.02 lrETH of collateral.
{% endhint %}

In both cases, the redemption process improves the collateral ratio of the affected collateral and debt, making them less risky. Partial redemptions decrease the debt while maintaining a portion of the collateral, while full redemptions completely pay off the debt, resulting in a reduction of collateral assets. This mechanism ensures the stability and integrity of the EpsiLoan protocol while providing flexibility for borrowers and redemption providers alike.

