Key Takeaways
- • Kroll and StepStone Group (Nasdaq: STEP) launched three payment-in-kind (PIK) indicators within the Kroll StepStone Private Credit Benchmarks, adding visibility into noncash interest across private credit.
- • The indicators cover more than 28,000 direct lending instruments, 18,000 deals and 13,000 borrowers, with historical data extending back to 2012.
- • Benchmark data shows global PIK use is moderating: PIK represented 2.86% of interest income on loans originated in the previous 12 months as of Oct. 10, versus 6.67% across the global cohort of outstanding loans at the end of Q2/26.
- • The metrics track PIK as a share of interest income, PIK loans by deal count, and PIK loans by outstanding principal, segmented by U.S. and Europe, sector and obligor size.
Summary
Kroll, an independent provider of global financial and risk advisory solutions, and StepStone Group (Nasdaq: STEP), a global private markets investment firm, have launched three new payment-in-kind (PIK) indicators within the Kroll StepStone Private Credit Benchmarks, according to the publication's report. The indicators are designed to give lenders, investors and analysts greater visibility into the use of noncash interest across private credit markets.
The dataset covers more than 28,000 direct lending instruments, 18,000 deals and 13,000 borrowers, with historical data extending back to 2012. The new measures track loans with an active PIK component across the U.S. and Europe, as well as across sectors and obligor-size segments, using three metrics: PIK as a percentage of interest income, the proportion of PIK loans by deal count, and the proportion of PIK loans by outstanding principal.
The Benchmarks indicate that PIK use is currently moderating rather than accelerating on a global basis. For loans originated during the previous 12 months, PIK represented 2.86% of interest income as of Oct. 10, compared with 6.67% across the global cohort of outstanding loans at the end of Q2/26. The data also reveals variance in PIK activity across EBITDA segments, geographies and sectors.
Michael H. Dolan, president of financial advisory at Kroll, said that private credit and private capital markets have shown relatively solid fundamentals despite a prolonged period of higher borrowing costs and economic uncertainty. He noted that the distinction between interest paid in cash and interest added to debt matters when assessing liquidity, leverage, credit quality and value. Marcel Schindler, partner and head of private debt at StepStone Group, said greater visibility into PIK activity provides another dimension for assessing market dynamics and comparing opportunities.
The Benchmarks, launched in September 2025, allow users to analyze private credit across multiple dimensions, including market segment, sector and lien position.
The dataset covers more than 28,000 direct lending instruments, 18,000 deals and 13,000 borrowers, with historical data extending back to 2012. The new measures track loans with an active PIK component across the U.S. and Europe, as well as across sectors and obligor-size segments, using three metrics: PIK as a percentage of interest income, the proportion of PIK loans by deal count, and the proportion of PIK loans by outstanding principal.
The Benchmarks indicate that PIK use is currently moderating rather than accelerating on a global basis. For loans originated during the previous 12 months, PIK represented 2.86% of interest income as of Oct. 10, compared with 6.67% across the global cohort of outstanding loans at the end of Q2/26. The data also reveals variance in PIK activity across EBITDA segments, geographies and sectors.
Michael H. Dolan, president of financial advisory at Kroll, said that private credit and private capital markets have shown relatively solid fundamentals despite a prolonged period of higher borrowing costs and economic uncertainty. He noted that the distinction between interest paid in cash and interest added to debt matters when assessing liquidity, leverage, credit quality and value. Marcel Schindler, partner and head of private debt at StepStone Group, said greater visibility into PIK activity provides another dimension for assessing market dynamics and comparing opportunities.
The Benchmarks, launched in September 2025, allow users to analyze private credit across multiple dimensions, including market segment, sector and lien position.
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