McKinsey examines how private credit is evolving into a more mature industry as fundraising moderates, competition increases, and investors broaden beyond traditional direct lending. While fundraising fell 16% in 2025, newer areas including asset backed finance and credit secondaries continued gaining momentum. Borrowers also regained negotiating power, signaling a shift from the lender friendly conditions seen in recent years.
Private credit in 2025: A maturing industry navigates change
McKinsey & Company
Hyder Kazimi
Research
12 Pages
Key Takeaways
Fundraising Growth Slows: Private credit closed end fundraising declined 16% to roughly $165 billion in 2025, marking a moderation after several years of exceptional industry expansion.
Terms Favor Borrowers: Median direct lending spreads fell from 650 basis points in 2023 to 544 basis points in 2025, while covenant lite issuance increased from 4% to 21%.
New Segments Expand: Credit secondaries transaction volume nearly doubled to about $20 billion in 2025, while GP led transactions increased threefold to approximately $12 billion.
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