Private credit is rapidly evolving from a speculative opportunity into a foundational asset class for high-net-worth investors in India.
The shift reflects a broader demand for diversification and predictable income streams as traditional market volatility persists.
Investors are increasingly turning to direct lending structures to secure stable cash flows that are less correlated with public equity swings.
The backbone of this expansion is the SEBI Category II Alternative Investment Fund (AIF) structure.
These funds, which lend directly to companies through privately negotiated debt agreements, now command nearly three-fourths of the total industry's capital commitments.
This dominance underscores the sector's maturity and the confidence institutional and wealthy individual investors place in these regulated vehicles.