Goldfinch Closes its First Callable Loan for Fazz, a Singapore-based Fintech

New Nimble, Flexible Structure will Allow for More Frequent and More Liquid Pool Offerings

By Aaron Collett, Senior Credit Manager at Warbler Labs

Goldfinch, an on-chain lending protocol, has successfully raised a USDC 1.35 million loan to Fazz, a Singapore-based Series C Fintech backed by Tiger Global. This deal marks the first time that Goldfinch has offered a callable loan.

A callable loan is a type of loan where the lender can demand full repayment of the loan at their request. The callable feature offers lenders more protection against interest rate risk and credit risk, as they can recall the loan if market conditions change or if the borrower’s credit quality deteriorates. The ability to recall capital is even more significant in crypto markets where conditions change quickly and investors may wish to reallocate capital regularly. Goldfinch decided to offer a callable loan structure after dozens of interviews with market participants highlighting their preference for regular redemption options and increased liquidity in their investments.

In this deal, Fazz Financial issued a 90-day callable loan with a fixed 13% USDC APY to Goldfinch’s pool of backers. Lenders usually have to sacrifice yield for the benefit of the call option. However, due to today’s constrained credit environment, this deal was executed with both the callable feature and an above-market yield.

Goldfinch is proud to partner with Fazz and plans further rounds of funding for the business on Goldfinch. Fazz is quickly growing its lending business and will need a nimble debt partner to fund new loans. Follow-on rounds of this deal will allow Fazz to refinance any capital called from the initial deal, as well as raise net new capital through the protocol.

In addition to Fazz, Goldfinch plans to launch callable structures with other borrowers. Since called capital will need to be refinanced with new loan pools, Goldfinch expects callable loan pools to open more regularly than term loans. As a result, live pools will be available to investors on a more regular basis than Goldfinch’s initial model of long-tenor, large-ticket loans.

Closing the first callable loan is a great milestone for the protocol, and the Goldfinch community is grateful to the backers who participated in this deal and trusted Fazz with their capital. Goldfinch believes that this new structure showcases its ability to provide flexible financing solutions to balance the needs of on-chain investors and off-chain borrowers.

To learn more about this deal and other Goldfinch deals, please visit http://deals.goldfinch.finance. Thank you for your continued support and stay tuned for more exciting updates from Goldfinch!