Global investment powerhouse Carlyle Group has formed a strategic partnership with Citigroup to deliver asset-backed financing solutions to fast-growing fintech lenders, signaling a major push into non-bank credit markets reuters.com.
The collaboration allows Carlyle and Citi to jointly invest in pools of consumer and small business loans originated by fintech platforms. By securitizing these loan portfolios, traditional financial sponsors bring liquidity and scale to alternative lenders while ensuring capital efficiency. Citi contributes its underwriting and structuring expertise; Carlyle brings asset-backed finance capabilities—typically targeting returns about 1.5 percentage points above public asset-backed securities wsj.com.
This partnership reflects mounting investor interest in private credit. Prudential’s PGIM Fixed Income, for example, recently agreed to purchase up to $500 million in consumer loans from Affirm—showing broader acceptance of fintech-originated, asset-backed debt wsj.com.
Carlyle’s Akhil Bansal cited growing demand for scalable, secure funding tools as traditional bank lending tightens and fintechs look for funding independence. The alliance creates a flexible alternative to equity rounds and reduces reliance on unpredictable capital markets reuters.com.
📌 Why It Matters:
- Opens institutional credit channels for fintech lenders scaling loan volume
- Enhances fintech resilience by leveraging asset-backed structures instead of equity
- Signals shift of private credit players from traditional banks toward fintech assets
Fintech lenders face increasing competition and capital demands. This deal underscores evolving industry support through structured financing rather than dilution-based capital—the kind typically offered through IPOs or venture equity.
