WILMINGTON, DEL. -- More than four fifths (82%) of limited partners (LPs) say they expect to increase allocations to private credit over the next three years, according to a new international study by CSC, the leading provider of global business administration and compliance solutions. Of these LPs, around two fifths (42%) expect “significant” growth in private credit exposure, underscoring the momentum and positive investor sentiment towards the asset class.

The research that canvassed the views of 300 general partners (GPs) and 200 limited partners (LPs) in Europe, Asia Pacific, and North America, found that portfolio diversification was the primary motive behind greater allocation (according to 76% of LPs), ahead of attractive returns (36%).

Private credit GPs are also bullish. The study, commissioned by CSC to inform its new report, “Private Credit 2025: Scaling Global Strategies Through Operational Excellence,” found three fifths (59%) of GPs forecasting AUM growth of 6-10% over a three-year horizon and 31% expecting growth above 10%.

“Private credit has exploded into the mainstream, becoming a truly global, multijurisdictional phenomenon that looks set to attract more and more investor capital,” said Marshall Saffer, managing director, Funds and Capital Markets at CSC. “As a business, we’re seeing first-hand how private credit has evolved, including innovation in structuring and cross-border strategies, and we’re well positioned to help GPs capitalize on strong demand.”

Growth driven by strategy shifts and cross-border expansion
CSC’s study found senior debt and asset-backed finance emerging as the most attractive underlying strategies, with distressed debt ranked lowest in expected growth. Cross-border lending is another major growth area, with 79% of GPs expecting international activity to increase significantly.

However, as the private credit sector grows, administrative complexity is increasingly taking its toll, especially for cross-border strategies where reporting, risk transparency, and operational readiness are under greater scrutiny.

“Private credit’s fast growth presents implicit challenges to operating models for fund managers, and imposes considerable demands on them and other stakeholders, particularly when investing in multiple jurisdictions and across borders,” said Constantinos Kleanthous, managing director, APAC at CSC. “As our study found, GPs have voted with their feet when it comes to outsourcing operational support to dedicated third-party specialists—and even more for functions like loan agency.”

CSC’s report found that 91% of LPs believe GPs who outsource to specialist service providers deliver enhanced reporting. Respondents cited SPV administration, collateral management, and loan agency as crucial in managing fund complexity and enhancing transparency.

As private credit cements its place in global portfolios, the research makes clear that growth must be matched with operational strength. GPs with the right infrastructure, and the right specialist partners will be best placed to seize the opportunity ahead.