Affirm’s latest private credit deal with Prudential’s PGIM Fixed Income brings $500 million in fresh capital to the fintech company’s growing buy-now-pay-later (BNPL) empire. The three-year agreement will allow Affirm to re-lend the funds repeatedly, supporting up to $3 billion in consumer loans.
This marks the second major transaction between PGIM and Affirm Holdings, solidifying a strategic alliance that reflects a broader shift: private credit is replacing traditional banks in consumer lending.
Prudential and Affirm: A $500M Partnership
The deal, announced this week, enables PGIM Fixed Income — the investment arm of Prudential Financial — to purchase up to $500 million in Affirm loans, most of which have a six-month maturity. Affirm can recycle this capital, using it multiple times over the course of the agreement.
This structure offers powerful flexibility for Affirm, allowing it to extend BNPL loans at scale, even in times when public debt markets are volatile or frozen.
Private Credit Steps In Where Banks Back Off
This isn’t PGIM’s first move into fintech lending. In December 2024, PGIM also bought $500 million in Affirm loans and took part in a $525 million securitization from SoFi Technologies. Other recent private deals include:
- $4 billion Affirm–Sixth Street Partners deal
- $750 million from Liberty Mutual Investments to Affirm
These relationships show how fintechs are building deep benches of private capital partners, replacing bank-led financing with long-term institutional money.
Why Private ABS Is Booming
Insurers and pension funds are racing to buy private asset-backed securities (ABS) because they offer stronger returns than public debt. PGIM, for example, targets 1.5% higher yields on private ABS than on public equivalents.
To strengthen its position in this growing market, PGIM recently hired Oliver Nisenson — formerly at Blackstone — to lead its private ABS division.
The Big Picture: Fintech + Private Credit = The New Normal
Affirm’s Chief Capital Officer, Brooke Major-Reid, explained that their financing model relies on three pillars:
- Warehouse loans from traditional banks
- Public ABS bond sales
- Private credit deals — like this one with PGIM
As nonbank lenders like Affirm scale, these partnerships give them access to stable, long-term capital, even when traditional markets tighten. Some financial experts argue this model is more resilient than traditional banking, since the money comes from institutional investors, not deposit accounts.
Expert Insight
“Private credit partnerships are transforming fintech funding,” said Edwin Wilches, PGIM’s co-head of securitized products. “This is just the beginning.”
Private Credit Trends to Watch
This 2025 deal highlights a few emerging trends:
- Fintech firms are moving away from banks
- Insurers and pensions want higher-yield, lower-risk debt
- BNPL remains strong, despite rising competition and regulatory pressure
Advocates claim that using long-term investor capital makes fintech lenders more stable than banks, since they’re not dependent on short-term deposits.
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