APAC to capture $4t private credit boom as loan returns shrink

Australia, Japan, and India are emerging as key private credit growth markets.

Private credit assets under management (AUM) are set to cross $4t by 2030, with the APAC and EMEA regions gaining traction, according to an estimate by Moody’s.

It is set to exceed $2t in 2026 alone, the ratings agency said.

APAC is poised for expansion, supported by a low starting base, rising domestic financing requirements, and investors’ search for yield and diversification.

“Whilst US corporate direct lending will still dominate in 2026, growth opportunities are rapidly shifting to other geographies such as EMEA and APAC and newer asset classes as investors look to diversify returns,” according to the report published on 21 January 2026.

Sustained economic growth, regulatory improvements and heightened demand for flexible, non-bank financing further strengthen the APAC region’s prospects, especially in Australia, Japan and India.

Returns for traditional corporate direct lending have compressed amidst intensified competition with the broadly syndicated loan market.

“In the past two years, as interest rates have eased from lofty highs, BSLs have been reclaiming lost market share from direct lenders as borrowers seek cheaper financing in the syndicated loan market,” Moody’s said.

Beyond corporate lending, asset-backed finance is emerging as a growth frontier, with large-scale deals becoming the norm. Public and private markets are aligning more the fund such deals, which include massive infrastructure deals, data center ecosystems, and mega corporate mergers, Moody’s noted.