Companies Turn to Private Credit Amid Trade Tariff Uncertainty

Amid renewed trade tariff volatility, companies are increasingly bypassing traditional banks in favor of private credit firms to secure loans, Reuters' Nupur Anand and Saeed Azhar reported.

Private credit is now a $2 trillion industry that’s quadrupled over the last decade.

Since early April, market turbulence stemming from inconsistent tariff policy has made syndicated bank loans more difficult to arrange, spurring a shift toward private credit — a now $2 trillion industry that’s quadrupled over the last decade.

“When you have volatility, it becomes relatively harder for the banks to place new deals,” said Mike Koester, co-founder of private credit firm 5C Investment Partners. “That is when private credit takes more share because it already has the capital and can lend directly.”