Private debt has evolved from a minor niche into a major segment of the global credit market. Two decades ago, this type of lending was seen as an under-the-radar alternative source of corporate funding with negligible volumes; now it is central to many institutional portfolios. Global private-credit assets under management are expected to exceed 2 trillion dollars in 2025. Projections point to 4.5 trillion dollars by 2030, making private credit the fastest growing segment of private markets. This expansion is being driven by strong investor demand, a shift in regulatory frameworks, and a growing preference over traditional bank lending.

Why the next three years could look very different from the last three

An equity investor typically follows the definition of an index provider such as MSCI to classify a country into one of three categories: developed, emerging, or frontier market. For MSCI to classify a country in emerging markets, its market would need to meet minimum thresholds for economic development, market size, and liquidity, but still show certain limitations in accessibility for international investors, which developed markets do not have (e.g. capital flow restrictions, foreign ownership limits, or operational inefficiencies). The third category, frontier markets, falls below emerging standards in size, liquidity, and institutional robustness.