New Delhi, Aug. 25 -- India's private credit market is expected to expand further as banks and Non-Banking Financial Companies (NBFCs) continue to leave funding gaps in specialised segments, but investors are likely to become more selective about collateral quality, contractual safeguards and their ability to influence insolvency outcomes, according to an EY research report.

The market was estimated at USD 25-30 billion as of March 2025, far smaller than the roughly USD 1.4 trillion US market. However, it has grown rapidly following periods of stress in the banking and NBFC sectors, with private credit funds increasingly financing refinancing, promoter funding, special situations, real estate and infrastructure.

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