Private Credit: Market Structure, Fund Design, & Retail Access

Private credit has grown from a niche institutional asset class into a $2.6 trillion global market and a major source of corporate financing. Driven by post–Global Financial Crisis regulatory reform, bank retrenchment, and investor demand for income, it has become a central feature of modern capital markets and is increasingly reaching wealth management clients and sophisticated retail investors through semi-liquid funds, non-traded business development companies (BDCs), interval funds, and digital platforms.

As this transformation accelerates, understanding how private credit is structured, how fund design shapes investor outcomes, and what expanding retail access means has become essential for investment professionals.

This report is the second in our series that examines how private market growth is reshaping capital markets. It aims to help financial intermediaries and sophisticated retail investors understand private credit markets and improve product design, distribution, and evaluation. The first report, Understanding the Growth of Private Markets: Structural Shifts in the Investment Industry, identifies key questions for investment firms, policymakers, and regulators. Our third report in the series, Private Credit Funds and the Retail Shift: Structural Vulnerabilities and Policy, examines how the retail shift may heighten liquidity, valuation, leverage, governance, and investor-protection risks, and outlines policy responses for more resilient growth.

Hear from the author, Cheryll-Ann Wilson

This report examines the structural evolution of private credit: from its origins as a post-financial-crisis lending alternative to its emergence as a major component of global capital markets. It explains how fund design, market structure, and expanding retail access influence liquidity, governance, valuation, and investment outcomes, and provides a practical framework for evaluating private credit in portfolios.

Private credit refers to privately negotiated lending outside public debt markets, where companies borrow directly from specialized investment funds and other non-bank lenders.

Retailization expands private market investing beyond institutions through more accessible investment vehicles while introducing new considerations related to liquidity, valuation, governance, and investor suitability. The report highlights this trend.

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Its aim is to provide a practical framework for evaluating opportunities, understanding structural risks, and implementing private credit with discipline.

Private credit has expanded as regulation, bank retrenchment, and investor demand have shifted more lending outside traditional banks. The report explains how these forces have transformed private credit from a niche institutional lending strategy into one of the fastest-growing segments of global capital markets.

How Do Private Credit Products Work?

The report compares closed-end, evergreen, interval fund, non-traded BDC, and tokenized structures and explains why fund design may matter as much as the underlying loans.

How Should Practitioners Evaluate and Implement Private Credit?

The report provides a practical framework for assessing liquidity, valuation, governance, borrower quality, fund structure, portfolio role, and investor suitability.

What Does Retailization Change?

Retailization expands how investors access private credit through different fund structures, but it does not change the underlying characteristics of the loans or the associated investment risks. As access expands, suitability and product design become more important.

Start with the big picture. Before exploring private credit, see how capital flows through today's financial system.

The Capital Markets Ecosystem framework provides the context for understanding where private credit fits, how it interacts with banks and public markets, and why it has become an increasingly important source of corporate financing.

Exhibit 1. Capital Market Ecosystem — How Companies Finance and Investors Invest

Source: Adapted from Private Credit: Market Structure, Fund Design, and Retail Access, CFA Institute Research and Policy Center. Capital Markets Ecosystem framework developed with input from Dr. Wolfgang Bessler.

Private market investing is reshaping how capital flows and value is created. To keep up, investors and professionals need sharper skills, stronger insights, and strategies that work in real time. View our new topic page