Why private credit is attractive to both businesses and investors

Private credit is a nonbank loan made directly to a business

Similar to private equity, private credit is part of the private markets world. Both strategies offer illiquid, privately negotiated investments for privately held companies. Unlike private equity investors, however, private credit investors typically do not take ownership stakes in the companies they invest in.

Private credit grew from a $250B asset class in 2010 to around $1.5T in early 2024

That's partly due to the industry's rising interest rates that created more upside for investors. Interest rates have increased in recent years alongside the Federal Reserve's interest rate hikes beginning in 2022. Private credit loans typically stretch over multiple years (typically between five and seven years, although term lengths vary).

Retail investors cannot directly invest in private credit funds—but other financial vehicles can offer exposure to the industry

For example, as some US regulations have loosened in recent years, retail investors have begun to get exposure to the private credit market via ETFs that invest in publicly traded financial vehicles with private credit exposure, such as BDCs.

Why private credit has faced challenges in recent years

The factors that some experts say are driving what could be private credit's most challenging era since the 2008 financial crisis include global economic uncertainty around trade and tariffs, investor fears about the amount of money being spent on artificial intelligence, and more.

Cheap debt and relatively minimal regulation fueled private equity's expansion

Low interest rates in the 2010s made taking on debt cheap, making leveraged buyouts incredibly lucrative. Private equity firms were able to make large deals quickly, in part because they don't face the same disclosure requirements and shareholder approval processes as public companies. These two factors juiced the growth of private funds.

The basics of private credit—plus why it matters in 2026

This podcast episode—one of the best we found for explaining the ins and outs of private credit—details how private credit became a significant lender for the tech industry, and how AI could disrupt private credit investments.

'Floating rate' loans periodically adjust their interest rates in accordance with economic conditions

When the Federal Reserve began raising interest rates in 2022 to combat inflation, interest payments borrowers owed to private credit lenders increased accordingly. Private credit funds benefited as loan returns increased, making the asset class attractive to investors at the time.

Family offices have been increasing their allocations to private credit

Private firms that manage family fortunes have been investing more in alternatives like venture capital and real estate, impacting the wider financial world.

Investing in private equity is typically reserved for 'accredited investors'

Limiting PE to accredited investors helps protect less experienced investors from large and risky investments. Accredited investors must meet requirements set by the Securities and Exchange Commission—they're typically required to have a net worth exceeding $1M, for instance. (Some users may experience a paywall.)

Find out ways to get lower rates on private loans, such as applying with a cosigner

More borrowers are being pushed to opt for private student loans as changes to federal borrowing caps and repayment plans are implemented. Private lenders typically advertise interest rates that fall anywhere between sub-3% and 15% or higher.

What are business credit scores?

Businesses have credit scores the same way individuals do—with a few key differences. For one thing, business credit scores range from 0 to 100 instead of 300 to 850, and are based on factors such as bankruptcy and bill-paying habits.

Special-purpose acquisition companies let companies skirt the IPO process

A video explains how private companies have taken advantage of this loophole, why investing in these companies isn’t always a good idea, and how blank-check companies (as they’re commonly called) work.

Apollo Global Management and Blackstone are among the world's top 20 private credit fund managers

While Blackstone is the world's largest alternative asset manager, Apollo Global Management is a large private equity firm. Apollo had $480B in private credit assets under management as of January 2025.

Private companies are often harder to value than public companies

That's partly because there isn't readily available stock information, and financial accounting is kept behind closed doors. Typically, determining the value of a private company involves, among other things, closely comparing the private company with its competitors.

Investors can buy three main types of bonds: government, corporate, and municipal

Each type has variations of its bond offerings with different interest rates, loan lengths, maturity dates, and terms. Each type also carries its own risks and rewards.

American Express caters its business to wealthy cardholders

American Express cards charge high annual fees, but also offer significant rewards and credits. It's just one way the company targets affluent customers who spend higher dollar amounts per transaction and tend to have more transactions than the average cardholder. This strategy decreases the company's risk, since it actually offers credit instead of just acting as a card network.

Banks have increased small loan programs since 2018, upping competition for payday lenders

One of the reasons payday lending flourished for nearly two decades is that most banks charged high overdraft fees and didn't offer small loans. However, since 2018, banks have increased their small loan options. Supporters say this provides safer alternatives for consumers, as banks are subject to more regulatory measures and are less likely to allow consumers to keep rolling over loans.

Different CDs can have different term lengths, interest rates, and more

For instance, if a bank needs more deposits to fund loans, then it may offer high interest rates to attract deposits. Alternatively, a large bank with sufficient deposit reserves may have less incentive to grow its CD portfolio, offering lower rates as a result.

Unlike small businesses, startups aim to disrupt entire industries

They also differ from small businesses in that startups have a higher level of risk, may take on outside funding from venture capital firms to boost growth, and more.

Convertible notes represent loans that startups owe investors

In the second part of a two-part series, convertible notes are explained to be a tool angel investors use to ensure they see a return on their investment in a startup.

How credit unions compare to traditional banks

Although credit unions offer great perks like higher-than-average interest rates, they aren’t the right fit for every customer. This handy guide helps would-be bankers identify their top financial priorities. To see how credit unions stack up against traditional banks across key areas like branch locations, customer service, and digital technology, click here.

Securitization has become common practice in home financing

When a homebuyer finances with a lender, they aren’t necessarily the one footing the bill. After a buyer secures a home loan, the lender can sell the loan to another financial institution or a private institution. That group can later sell that mortgage to investors. This is called securitization.

How art-backed loans work

Using your art collections—some of which are valued in the millions—to secure a loan is becoming more common among collectors. Here's a breakdown on how banks and private lenders are making best of the opportunity in liquidity.

Venture capital is a form of funding provided to early-stage companies with high growth potential, typically in exchange for an equity (or ownership) stake

Nearly half of millennials and Gen Z use BNPL, versus 21% of older generations

While applicants typically need a good credit score and credit history to qualify for many credit cards, that's not the case with buy now, pay later loans, making them more accessible forms of payment for younger generations.

Hedge funds, the private investment firms that trade a wide swath of financial assets, make money by imposing steep fees on investors and from the fund's investment performance.

Both individuals and businesses can establish trusts

Business trusts can allow trustees to manage a beneficiary’s stake in a business, and more. There are many different specific types of business trusts.

Learn how to read a prospectus, the juicy document that any company must file with the SEC before going public.

US consumers collectively owe more than $1T to credit card companies—almost as much as they owe in auto loans.

The first steps to rebuilding your credit score include getting to know exactly what's on your credit report and figuring out how far you are from the '700 club,' or 'good score' range.

How Amazon operates a 'flywheel' business model, a self-reinforcing cycle that drives continuous growth

Warren Buffett's former professor Benjamin Graham is known as the 'father of value investing,' a strategy in which investors seek to buy stocks trading below their intrinsic worth.

The idea for the Federal Reserve was conceived in secret in 1910—with bankers donning duck hunt gear for disguise while traveling to a remote country club on Georgia's Jekyll Island

Netflix profits when you're not watching, and its movies are designed that way—read a detail-rich critical essay exposing lesser-known Netflix takes

'Silent' fireworks have gained more interest in recent years as a quieter celebratory option.

Dozens of S&P 500 stocks, including Coca-Cola and Walmart—known as the dividend aristocrats—have increased dividends every year for 25 years

Telehealth demand for GLP-1s for weight loss is booming as consumers seek easier access.

Memecoins are a type of cryptocurrency—a form of digital currency with a wide variety of uses—created around popular 'memes,' or viral internet jokes.

Art theft is the third-largest source of criminal revenues worldwide, thanks in part to the subjective nature of valuing a work of art.

The American Society of Civil Engineers' infrastructure report card gave the US a C in 2025, its highest grade since the project launched in 1998.

Larger animals like giraffes, elephants, and blue whales have developed a unique defense against cancer, a phenomenon known as Peto's Paradox

Power lines are dotted with large, brightly colored balls to improve the visibility of these thin wires to helicopters and small planes and help prevent potential crashes.

In 2025, four executives from large tech companies were given positions in the US Army Reserves—including Palantir Chief Technology Officer Shyam Sankar, which reinforced Palantir's ties with the US military and its role as a leading defense partner.

When caught in the mouths of cardinal fish, seed shrimp release glowing, bioluminescent chemicals, which alert predators of the cardinal fish, prompting the shrimp's ejection.

How fusion—which releases energy when two lighter atoms combine to form a heavier atom—differs from fission

Sony set the standard for cylinder-shaped batteries when it repurposed manufacturing equipment used to make rolls of magnetic recording tape.

Mid-century modern graphic designers, known for their bright colors and bold lines in advertising, also found success with children's books.

Pure water does not conduct electricity because this flow of energy requires the movement of charged particles, and water is a neutral molecule.

Explore an interactive map built from more than 100,000 survey responses on where people find joy in their lives

To reduce wrinkles in clothing, research recommends gentle wash cycles with more water and tumble drying with smaller loads and longer times.