Stock Lending Scheme? Anybody have experience?

I got call from broker that stocks in portfolio can be given for lending purpose. He said I will receive fee after brokerage of 15%. Amount quoted is v. good.

What is risk of stock lending. If borrower unable to return stock what happens? Who takes loss?

E.g. borrower takes 100 shares of HDFC Bank with view that stock will fall to Rs. 800. At that time stock is Rs. 1000. He does short-sell. However, HDFC Bank goes to Rs. 1200 and borrower suffers heavy loss? Who bears that loss? What is status of lender? He gets back 100 shares on due date with interest? From whom?

 

sroutaji i think it is a insider adjustment by the broker.
better take opinion from experts having experience.

 

I am bit worried because for little interest I don't want to risk capital.