American equipment financing platform Trad.Fi has announced plans to raise private online loans worth up to $650 million over the next 48 months.
According to an announcement shared with Cointelegraph, the initiative is aimed at one of the largest and least digitized lending markets in the US, a trillion-dollar industry financing manufacturing equipment, industrial systems and residential photovoltaic installations.
Trad.Fi says the $650 million is not committed capital, but a credit pipeline that will be launched across the supply chain, supported by committed senior credit lines and signed letters of intent from anchor borrowers. The company said it currently has approximately $85 million under contract, with the transaction expected to close soon at approximately $40 million.
The initiative aims to address the financing bottleneck in the manufacturing industry by shortening digital loan approvals to one business day compared to weeks or months for approvals for classic lines of credit.
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Equipment financing in the U.S. is a rapidly growing industry that remains document-based, slowing the loan approval process and creating costs for businesses, said Alexander Szul, the company’s CEO. Trad.Fi.
Added:
“Small businesses are losing business while waiting for financing, and the only way to fix this is to move capital, documentation and workflow to programmable rails.”
Investors will gain exposure through a tokenized pool of loans
The initiative will also include an onchain investment pool that will provide investors with exposure to equipment financing loans provided via the platform. The pool will be operated by a third party, which has not yet been named, and is expected to be operational in the coming weeks. US-based investors will not be eligible in the initial phase.
W3 will provide the infrastructure to tokenize loans and manage associated loan records on the Base, Arc and Avalanche blockchains. Legal contracts associated with loans, including UCC-1 filings and borrower documentation, will remain off-chain.
Other companies offering similar tokenized lending products include Centrifuge, Tradable, Maple Finance, Figure Technologies, and Credix.
The initiative would contribute to the growth of the tokenized real asset (RWA) market, although the sector has cooled in recent weeks, with total value falling 4.4% in the last 30 days to $31.3 billion.
Total RWA by category. Source: RWA.xyz
Tokenized U.S. Treasury debt accounted for $14.8 billion of the total RWA market, while tokenized corporate credit made up the smallest segment at $1.2 billion. According to to RWA.xyz data.
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