BEIJING (AP) — Chinese authorities allowed the country’s first corporate bond default on Friday, inflicting losses on small investors in a painful step toward making its financial system more market-oriented.

Investors in bonds sold in 2012 by Chaori Solar Energy Science & Technology Co., a manufacturer of solar panels, were paid as little as 3 percent of the interest that was due Friday, according to two bondholders, one of whom said he put his parents’ savings into the bonds. The company warned earlier this week it had only 4 million yuan ($660,000) and faced an interest payment of 90 million yuan ($15 million).