How local private credit funds pulled ahead of foreign rivals in the mid-market
Domestic private credit funds have significantly outpaced their foreign counterparts in India's mid-market segment during the first half of 2026. According to EY data, local funds accounted for approximately 74% of the deal value and 79% of the deal volume. This marks a substantial shift, as the share of global funds in this segment dropped to 26% from 68% in the previous year, highlighting a growing dominance of indigenous players.
What this means
The ascendance of local private credit funds reflects their deeper understanding of the domestic market, stronger local networks, and potentially greater flexibility in deal structuring compared to foreign rivals. This could lead to more tailored and accessible financing options for Indian mid-market companies, reducing reliance on traditional bank lending for specific needs.
Most affected: Mid-market lending, Alternative investment funds, Corporate finance
Key takeaway: Recognize the increasing role of local private credit funds as a significant financing channel for mid-sized Indian businesses, potentially impacting competition for traditional lenders.
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