Citi and Carlyle Group have agreed to invest together in growing FinTech companies and the assets these firms generate, such as consumer loans. This partnership allows both firms to invest side-by-side in startups through private debt or equity and eventually manage public asset-backed bonds.
The deal targets the $5.2 trillion asset-backed finance market, which includes debt secured by assets like mortgages and auto loans. Carlyle will collaborate with Citi’s venture team, Spread Products Investment in Technologies (SPRINT), which focuses on FinTech investments.
Akhil Bansal, Carlyle’s head of asset-backed finance, said the partnership aims to support FinTech companies throughout their growth by providing private capital and public securitization options.
This is Citi’s third recent partnership with asset managers to expand its private credit business. Previous deals include collaborations with Apollo Global Management and LuminArx Capital Management.
Rajiv Amlani, Citi’s global head of private markets coverage, noted that AI is transforming FinTech, attracting new specialty lenders eager to grow with banks and private credit firms.
The partnership comes as younger consumers, especially Generation Z, increasingly prefer FinTech services. Recent research shows 54% of Gen Z rely mainly on non-traditional financial providers, valuing real-time payments and companies that share their social values.
Gavin Michael, CEO of digital-only Varo Bank, explained that Gen Z wants financial products that fit their values and lifestyle and are digitally accessible. Varo offers services like short-term cash advances and AI-driven credit lines, underwriting based on cash flow rather than traditional credit scores.
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