Anyway its my first time seeing the lender defend the defaulter. Maybe they made an inside deal to pay back later, but I know from my experience that few of such defaulters are honest enough to pay back maybe a year or two later while others just leave it to their karma.
Here lender has good intentions and believes that everyone is honourable. Defaulter, in this case, know that and abundantly use his good will. probably gives him various promises and increasingly postpone the final day for payment. Unfortunately, I know of this method from personal experience.