Asia's private credit market has reached a structural inflection point. Bank retrenchment from traditional lending — accelerated by Basel IV capital requirements — combined with a massive financing gap in the region's rapidly growing mid-market segment has created a generational private credit opportunity.
Market Size and Growth
Asian private credit AUM is estimated to have reached $250 billion in 2025, with consensus forecasts projecting growth to $450-500 billion by 2028. Singapore and Hong Kong are the primary fund domiciliation hubs, with deployment concentrated in Southeast Asia, India and Australia.
The Financing Gap
The mid-market financing gap across Southeast Asia alone is estimated at $2 trillion. Traditional bank lending has become increasingly restrictive for growth-stage companies without substantial collateral, creating meaningful demand for private credit solutions.
Risk Considerations
Currency risk management is the most significant operational challenge for regional private credit strategies. Most deals are denominated in local currencies while institutional investor capital is primarily USD or EUR-denominated. FX hedging costs can materially impact net returns.
Swiss Ace's Approach
For clients allocating to Asian private credit, we recommend a direct lending approach focused on Singapore-nexus businesses, Australian mid-market opportunities, and selected Indian growth situations — where we have the diligence infrastructure to assess credit risk effectively.
Structural Recommendations
Optimal structuring for Asian private credit allocation typically involves a Singapore or Cayman master fund with appropriate feeder structures for different investor categories, supported by robust co-investment rights for separately managed accounts.
Swiss Ace provides disciplined investment advisory and business solutions across global markets.