FinStatGlobe Fintech Statistics 2026

How Borrowing Against Future Income Works

By FinStatGlobe Research · Published

  • asset-backed finance
  • borrowing
  • future income
  • securitization
  • credit
  • elite finance
  • explainer

Introduction

When Bloomberg reported in August 2026 that a company controlled by LeBron James had borrowed almost $300 million from two Midwestern life insurers — arranged by Guggenheim Partners and structured as sales of asset-backed bonds — the striking part was not the size of the number. It was the collateral. The loans were backed by James’s own future earnings, including guaranteed money from his endorsement deal with Nike.

That transaction is a vivid, real-world example of a mechanism that quietly runs through all of modern finance: borrowing against future income. Understanding how it works — and what it requires from a country’s financial system — explains a great deal about why credit behaves so differently across the 217 economies FinStatGlobe tracks. For the ranking that shows where a $300 million loan is even possible, see our companion data report on where a $300 million loan is possible.

The core idea: a promise becomes collateral

The simplest form of borrowing is secured against something you already own: a house, a car, a portfolio. Borrowing against future income is different — the collateral is money you will earn, not money you have.

The mechanism works in three steps:

  1. A guaranteed income stream exists. A contract that obligates someone to pay you in the future — an endorsement deal, a player contract, a pension, a long-term lease.
  2. The stream is isolated into a legal vehicle. In James’s case, an LLC controlled by him holds the rights to those future payments. This separation is what lets a lender look at one specific income stream instead of a whole messy financial life.
  3. The lender advances cash against that stream. The repayment comes out of the future payments as they arrive.

When the loan is packaged so that it can be sold to investors — as asset-backed bonds were here — the income stream has effectively been securitized: turned into a tradable financial instrument. For a related mechanism applied to athlete contracts, see our explainer on how deferred compensation works.

What makes the mechanism possible

Borrowing against future income is not something anyone can do anywhere. It depends on a chain of preconditions, each of which is stronger in some countries than others:

Credit depth. The lender must be large and sophisticated enough to underwrite a nine-figure loan against an intangible. That only happens where credit is deep relative to the economy. In Hong Kong, domestic credit to the private sector equals 231% of GDP; in Afghanistan, just 3.1%. The gap is the difference between a financial system that can price a future income stream and one that cannot extend even a modest loan. Our explainer on what private sector credit means walks through the indicator.

Legal enforceability. A lender will only advance against future payments it believes it can actually collect. This requires contract law that holds up, and courts that will enforce an assignment of future earnings. This is why the same legal infrastructure that enables asset-backed finance also underpins ordinary secured lending.

A market for the paper. Structuring the loan as asset-backed bonds means there are investors willing to buy them. That market exists mainly in countries with developed capital markets — see our analysis of where credit runs deepest.

Cost of credit. Finally, the loan has to be affordable relative to the income it is secured against. At the United States’ lending rate of roughly 3.3% (2021 data), a $300 million loan is serviceable against guaranteed endorsement income. In Argentina, where rates run to 61.7%, the same loan would roughly double in about 18 months — the mechanism still works, but it becomes a wealth-destroying trade.

From elite athletes to ordinary borrowers

It is tempting to file this away as a curiosity of superstar finance. But the same logic scales all the way down the income ladder.

Every one of the World Bank’s measures of ordinary borrowing is, at root, a version of the same idea: a lender advancing money today against income the borrower expects to earn. When Canada reports that 81% of adults borrowed from a financial institution, and Morocco reports 1.4%, the difference is not that Canadians are more credit-hungry — it is that the Canadian financial system can underwrite against future income at scale, and the Moroccan one largely cannot. Our report on how the world borrows explores this divide.

The same depth that lets a star monetize a sneaker contract is what lets a household finance a car (where a car loan is possible) or what lets a small firm borrow against next quarter’s sales (how firms borrow to run and grow). Where credit is deep, future income is liquid; where it is shallow, even a solid income cannot be spent before it arrives.

The risks on both sides

Borrowing against future income concentrates risk in a way that secured lending against physical assets does not. If the future income does not materialize — an endorsement deal collapses, a career-ending injury arrives, a contract is disputed — the collateral evaporates. This is exactly the risk that makes lenders demand the guarantee be contractual (legally owed regardless) rather than merely probable.

For borrowers, the risk is leverage. Converting future income into present cash is powerful, but it means the future is already spent. The discipline of thinking about credit this way — as trading tomorrow’s income for today’s spending — is the same whether the borrower is a billionaire athlete or a household taking out its first loan. For a look at how this plays out in the insurance world, see our analysis of what protects a star’s paycheck and how insurers differ across countries.

Sources & method

This explainer draws on FinStatGlobe’s derived datasets, built from public sources. Private sector credit is the World Bank’s domestic credit to the private sector (% of GDP) (indicator FS.AST.PRVT.GD.ZS); lending rates use the World Bank’s lending interest rate (%) (FR.INR.LEND); borrowing prevalence is from the World Bank Global Findex. Data years vary by country — the year cited for each figure is that country’s most recent observation. The LeBron James loan is reported by Bloomberg (August 25, 2026); we rely on that reporting for the factual details of the transaction, which our datasets do not cover. For our full methodology, see the methodology page.