Pagaya Advances Its Capital Markets Strategy With a Landmark $350 Million Revolving Personal Loan ABS Transaction
Pagaya Technologies LTD. (NASDAQ: PGY), a global financial technology company known for delivering artificial intelligence–powered product solutions across the modern financial ecosystem, has announced the successful closing of PAID 2025-REV1, a $350 million asset-backed securitization backed by consumer personal loans originated through the Pagaya network, marking a pivotal milestone in the company’s ongoing effort to expand, diversify, and strengthen its funding architecture while reinforcing its position as a leading innovator in structured consumer credit markets.
A First-of-Its-Kind Structure for Pagaya’s Personal Loan Platform
The PAID 2025-REV1 transaction represents the first revolving asset-backed securitization ever completed for Pagaya’s personal loan business, introducing a new long-term capital solution that complements and enhances the company’s already well-established public ABS issuance platform, while simultaneously offering institutional investors a differentiated vehicle for accessing high-quality consumer credit exposure through a highly structured and scalable format designed to meet evolving market needs.
Strategic Partnership With 26North Partners Signals Institutional Confidence
This inaugural revolving personal loan ABS transaction was executed in partnership with affiliates of 26North Partners LP, an alternatives-focused investment platform, underscoring strong institutional confidence in Pagaya’s underwriting technology, data-driven risk management capabilities, and disciplined approach to asset selection, while also laying the foundation for a potentially long-term strategic relationship aimed at expanding access to innovative consumer credit structures.
Designed Specifically for Insurance Capital and Asset Managers
The newly launched revolving Personal Loan ABS product was structured by Pagaya’s Capital Markets team with a clear focus on the needs and preferences of insurance capital providers and institutional asset managers, offering a liquid security format that combines predictable cash flows, attractive risk-adjusted returns, and reinvestment optionality, all of which are increasingly sought after by sophisticated investors navigating a complex and uncertain macroeconomic environment.
The Advantages of a Revolving Deal Structure
Unlike traditional static securitizations, the revolving structure of PAID 2025-REV1 allows Pagaya to reinvest principal repayments into newly originated personal loans over a defined period, thereby maximizing capital efficiency and extending the economic utility of the initial funding commitment, while also enabling investors to maintain exposure to a continuously refreshed pool of assets under consistent underwriting standards.
A 24-Month Revolving Period That Expands Funding Capacity
The transaction features a 24-month revolving period, during which loan repayments can be redeployed into new originations, effectively doubling the total funding capacity of the deal to approximately $700 million over its full lifecycle, a feature that significantly enhances the scale and flexibility of Pagaya’s personal loan funding engine while providing long-duration exposure for investors seeking stable returns over an extended horizon.
Strengthening Pagaya’s Multi-Channel Funding Ecosystem
By adding a revolving ABS structure to its funding toolkit, Pagaya further diversifies its already robust capital stack, which includes public term ABS, private securitizations, and forward-flow arrangements, allowing the company to optimize funding sources across market cycles and maintain consistent support for its lending partners regardless of fluctuations in broader credit markets.
Supporting Lending Partner Growth Through Sustainable Capital
One of the core objectives of the PAID 2025-REV1 structure is to provide sustainable, long-term funding that enables Pagaya’s network of lending partners to scale responsibly, originate more loans, and expand access to credit for consumers, all while maintaining rigorous credit standards powered by Pagaya’s proprietary AI and machine learning models.
Building on Proven ABS Innovation in Point-of-Sale Lending
The revolving personal loan ABS structure builds upon similar point-of-sale ABS products that Pagaya successfully launched in 2025, demonstrating the company’s ability to adapt proven structuring concepts across multiple asset classes and extend innovative funding solutions beyond their original use cases, thereby reinforcing Pagaya’s reputation as a leader in consumer credit securitization.
Capital Markets Expertise at the Core of Execution
Pagaya’s Capital Markets team played a central role in designing and executing the PAID 2025-REV1 transaction, leveraging deep expertise in structured finance, investor engagement, and deal execution to deliver a market-ready product that balances the needs of investors, lending partners, and the broader Pagaya ecosystem.
Executive Perspective on Investor-Centric Product Design
Commenting on the transaction, Sahil Chandiramani, Pagaya’s Head of Capital Markets, emphasized the investor-focused approach behind the structure, noting that the revolving ABS format was intentionally designed to provide insurance capital providers and asset managers with access to consumer credit exposure that offers both attractive carry and reinvestment potential within a liquid and transparent security framework.
Aligning Investor Needs With Long-Term Platform Growth
Chandiramani further highlighted Pagaya’s commitment to developing structures that not only meet current investor demand but also support the long-term scalability of the company’s platform, reinforcing the idea that sustainable growth in consumer credit requires funding solutions that are resilient, repeatable, and aligned with the evolving objectives of institutional capital providers.
Establishing a Longstanding Relationship With 26North
The partnership with 26North is expected to extend beyond a single transaction, as both organizations share a strategic alignment around innovation, disciplined risk management, and long-term value creation, positioning the relationship as a potential catalyst for future capital markets initiatives and expanded collaboration across additional asset classes.
Navigating Market Uncertainty Through Product Innovation
At a time when global credit markets continue to face heightened uncertainty driven by inflationary pressures, interest rate volatility, and shifting investor sentiment, Pagaya’s ability to launch a new and complex structured product underscores the company’s resilience and adaptability, as well as its willingness to innovate proactively rather than retreat in challenging market conditions.
CFO Commentary on Disciplined Growth and Diversification
Evangelos Perros, Pagaya’s Chief Financial Officer, highlighted the strategic importance of the transaction in the context of the company’s broader growth objectives, emphasizing that Pagaya remains focused on disciplined expansion, prudent balance sheet management, and ongoing diversification of both its funding sources and lending partner relationships.
Expanding the Lending Partner Network in 2026
Looking ahead, Pagaya expects to onboard several new lending partners in 2026 across its Personal Loan, Auto Loan, and Point of Sale Loan segments, with the new revolving ABS structure playing a critical role in providing the efficient and scalable funding necessary to support this anticipated growth without compromising underwriting quality or operational discipline.
Enhancing the Personal Loan Market Opportunity
The introduction of a revolving personal loan ABS structure significantly enhances Pagaya’s ability to capture a larger share of the personal loan market by ensuring consistent access to capital, reducing funding friction for lending partners, and enabling faster response times to changes in consumer demand and market conditions.
AI-Driven Underwriting as the Foundation of Asset Quality
At the heart of the PAID 2025-REV1 transaction is Pagaya’s AI-driven underwriting technology, which analyzes vast datasets to identify high-quality credit opportunities, optimize risk selection, and deliver consistent performance across economic cycles, providing investors with confidence in the underlying asset pool supporting the securitization.
Creating Alignment Across the Financial Ecosystem
Pagaya’s platform is designed to create alignment between consumers seeking access to credit, lending partners aiming to grow responsibly, and institutional investors looking for scalable and transparent investment opportunities, with the PAID 2025-REV1 transaction serving as a clear example of how innovative structuring can bridge these diverse interests.
Long-Term Implications for Pagaya’s Capital Strategy
The successful execution of this revolving ABS transaction has broader implications for Pagaya’s long-term capital strategy, as it demonstrates the company’s ability to continuously evolve its funding model, respond to investor feedback, and introduce new structures that enhance resilience and scalability in an increasingly competitive fintech landscape.
Positioning Pagaya as a Leader in Consumer Credit Structuring
By delivering a first-of-its-kind revolving personal loan ABS and partnering with a sophisticated alternatives platform like 26North, Pagaya further cements its position as a leader in consumer credit structuring, setting a benchmark for innovation that other fintech and financial institutions may seek to emulate in the years ahead.
About Pagaya Technologies
Pagaya (NASDAQ: PGY) is a global technology company making life-changing financial products and services available to more people nationwide, as it reshapes the financial services ecosystem. By using machine learning, a vast data network and an AI-driven approach, Pagaya provides comprehensive consumer credit and residential real estate products for its partners, their customers, and investors. Its proprietary API and capital solutions integrate into its network of partners to deliver seamless user experiences and greater access to the mainstream economy. Pagaya has offices in New York and Tel Aviv. For more information, visit pagaya.com.
