Pagaya Secures $280 Million Credit Facility for AI-Driven Consumer Finance Products

Pagaya Technologies has secured a credit facility worth $280 million from top global asset managers and financial institutions.

This facility, consisting of a $255 million term loan and a $25 million revolver, will provide capital and liquidity to support Pagaya’s future growth and extend its corporate debt maturity to 2029, the global technology company said in a Wednesday (Feb. 7) press release.

The organizations providing the credit facility include BlackRock, UBS O’Connor, JPMorgan Chase, Valley Bank and Israel Discount Bank, according to the release.

“This credit facility, led by BlackRock, showcases the confidence and support from some of the largest and most sophisticated financial institutions in the world, as we transform the consumer finance ecosystem in the next phase of our growth journey,” Gal Krubiner, co-founder and CEO of Pagaya, said in the release.

Pagaya provides artificial intelligence (AI)-driven product solutions in the financial ecosystem, according to the release.

With machine learning (ML), a vast data network and sophisticated AI algorithms, the company offers consumer credit and residential real estate solutions, the release said. Its proprietary application programming interface (API) and capital solutions seamlessly integrate with partner networks, enhancing user experiences and expanding access to the mainstream economy.

Dan Worrell, managing director at BlackRock, said in the release: “We are impressed by the company’s differentiated business model, core product offering and financial strategy to create more financial opportunities and to enable new customer relationships.”

Pagaya has been expanding its network rapidly, securing four new lending partners, including a top bank and top auto captive, in the last four months of 2023, according to the press release.

In one recently announced partnership, Pagaya teamed with automotive FinTech company Westlake Financial to provide Westlake’s auto dealer partners access to Pagaya’s tech-enabled credit-decisioning product.

Furthermore, Pagaya recently pre-announced full-year 2023 financial performance, with network volume surpassing $8.2 billion and adjusted EBITDA exceeding $75 million, the Wednesday release said. This implies an annualized run-rate adjusted EBITDA of over $110 million based on the fourth quarter of 2023.

The proceeds from the credit facility will be used to pay off outstanding borrowings from the company’s previous facility, invest in product innovation, and expand its network with both existing and new lending and investor partners, per the release.