Pagaya CEO Gal Krubiner – Transforming consumer lending with AI
Feb 8, 2024
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Gal Krubiner, Co-founder and CEO of Pagaya, discusses how AI can reshape credit underwriting and improve financial inclusion. They cover topics like Pagaya's AI-driven lender network, the future of AI in financial services, Pagaya's IPO, and more.
Pagaya uses AI and a network of investors to reshape credit underwriting and provide more credit opportunities.
Pagaya's decoupling of servicing relationship and risk assessment capabilities through collaboration with banks has enabled greater financial inclusion.
Deep dives
Pagaya's mission to increase credit opportunities
Pagaya's mission is to help lenders provide more credit opportunities to more people. By leveraging AI and a network of investors, lenders, and customers, Pagaya aims to reshape and modernize credit underwriting systems and expand access to credit for underserved individuals.
The role of AI in credit risk assessment
Pagaya leverages AI to assess credit risk and make more informed lending decisions. By analyzing extensive data from multiple lenders, Pagaya's AI models can identify patterns and behaviors that traditional underwriting may overlook. This allows Pagaya to approve borrowers who may have been denied by other lenders due to factors such as past bankruptcies or low FICO scores.
Risk shifting and collaboration with banks
One of Pagaya's innovations is decoupling the servicing relationship from the underlying assets, which helps shift risk away from banks and lenders. This arrangement allows lenders to focus on client relationships while institutional investors provide the funding. Through collaboration with banks, Pagaya gains access to valuable decline reasons and historical performance data, enhancing their risk assessment capabilities.
The impact of Pagaya's credit opportunities
Pagaya's lending model has enabled more individuals to access credit that they may have been previously denied. Approximately 70% of Pagaya's approved loan applications were declined by other lenders, and 55% of the issued loans serve low to medium-income borrowers. The company's focus on financial inclusion has also resulted in 36% of approvals benefiting black or Latinx consumers.
Nate Gee hosts Gal Krubiner, Co-founder and CEO of Pagaya, whose AI-driven network of investors, lenders, and borrowers aims to reshape the credit underwriting process and extend financial opportunity to more consumers.
In this episode, they cover:
- Gal’s motivation for founding Pagaya
- How qualified loan applicants can be left behind in traditional credit underwriting
- Pagaya’s AI-driven lender network and how it works
- The future of AI in financial services
- Pagaya’s IPO in 2021
- And much more!
About Pagaya Technologies
Pagaya was founded in 2016 with a goal to promote financial inclusion through improved credit underwriting and evaluation. It aims to build the leading AI network to enable better outcomes and create new credit opportunities for financial services providers and their customers. The company became publicly listed in 2021 (NASDAQ: PGY).
About Gal Krubiner
Gal Krubiner has served as Pagaya’s Chief Executive Officer since he co-founded the company in 2016. Prior to co-founding Pagaya, Gal focused on structuring and distributing sophisticated credit and asset-backed securities products at UBS AG. He’s also held other roles in investments, entrepreneurship, and financial markets. Gal graduated from Tel Aviv University in 2012.
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Nate’s LinkedIn: https://www.linkedin.com/in/nathan-c-gee/
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