Key Takeaways
- • India-focused private credit AUM is projected to reach $56-65 billion by 2030, up from $21.8 billion in CY2025, a near-threefold increase and a compound annual growth rate of about 21-24%, according to a CareEdge Ratings report.
- • Private credit penetration in India stands at only 0.6% of GDP, versus 4.4% in the United States and 8.4% in the United Kingdom, indicating substantial long-term headroom.
- • Tighter bank lending norms, rising demand for bespoke financing, a large refinancing opportunity and a strengthening insolvency and recovery framework are cited as the main growth drivers.
- • Direct lending, venture debt and real-estate debt are expected to be the fastest-growing private credit strategies in the near future.
Summary
CareEdge Ratings projects that India-focused private credit assets under management will rise to $56-65 billion by 2030 from $21.8 billion in calendar 2025, according to a report released on Wednesday. The projection implies a compound annual growth rate of roughly 21-24%. The report characterises the market as still at an early stage of development, with private credit equal to only 0.6% of GDP, compared with 4.4% in the United States and 8.4% in the United Kingdom.
The report also places India's overall credit-to-GDP ratio in context. It rose from 88.3% in 2022 to 93.8% in 2023, 95.3% in 2024 and 102.3% in 2025. Developed economies such as the United States, the United Kingdom and Australia maintain credit-to-GDP ratios between 140% and 200%, which CareEdge cites as evidence of further room for expansion.
According to the report, private credit is filling a funding gap for mid-market, growth-stage and asset-light businesses that traditional lenders underserve. Growth is being driven by tighter bank lending norms, increasing demand for bespoke financing, a large refinancing opportunity, and a strengthening insolvency and recovery framework. Direct lending, venture debt, special situations and real-estate credit are expected to drive the expansion.
Tanvi Shah, Senior Director at CareEdge Advisory, said disciplined underwriting, risk-adjusted pricing and strong covenant protection will be critical to converting market growth into sustainable returns. Kalpesh Mantri, Assistant Director at CareEdge Advisory, said private credit is poised to coexist with, rather than replace, traditional lending channels, strengthening the financing ecosystem for underserved borrowers.
The report also places India's overall credit-to-GDP ratio in context. It rose from 88.3% in 2022 to 93.8% in 2023, 95.3% in 2024 and 102.3% in 2025. Developed economies such as the United States, the United Kingdom and Australia maintain credit-to-GDP ratios between 140% and 200%, which CareEdge cites as evidence of further room for expansion.
According to the report, private credit is filling a funding gap for mid-market, growth-stage and asset-light businesses that traditional lenders underserve. Growth is being driven by tighter bank lending norms, increasing demand for bespoke financing, a large refinancing opportunity, and a strengthening insolvency and recovery framework. Direct lending, venture debt, special situations and real-estate credit are expected to drive the expansion.
Tanvi Shah, Senior Director at CareEdge Advisory, said disciplined underwriting, risk-adjusted pricing and strong covenant protection will be critical to converting market growth into sustainable returns. Kalpesh Mantri, Assistant Director at CareEdge Advisory, said private credit is poised to coexist with, rather than replace, traditional lending channels, strengthening the financing ecosystem for underserved borrowers.
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