INDIA Law and Practice Contributed by: Utsav Johri, Sucheta Bhattacharya and Nishal Makharia, JSA Advocates & Solicitors
JSA Advocates & Solicitors One Lodha Place, 27th Floor Senapati Bapat Marg Lower Parel Mumbai 400 013 India
Tel: +91 22 43418900 Fax: +91 22 43418917 Email: mumbai@jsalaw.com Web: www.jsalaw.com
1. Private Credit Overview 1.1 Private Credit Market
banks can lend for productive purposes. Since 1 April 2026, the RBI also allows Indian banks to lend for acquisition finance where the objective is to secure long-term strategic control of the target company. However, banks can only lend to certain eligible acquirers that meet certain monetary and profitability conditions. Such fundings are subject to guardrails prescribed by the RBI. Private credit funds are a flexible source of capital that can be used for a variety of purposes that Indian banks may not be able to service, or where funding from Indian banks is subject to regulatory restrictions on end use and exposure norms. Therefore, there has not been a significant overlap between the Indian pub - lic debt market and the private credit market. How - ever, with the latest liberalisation by the RBI allowing Indian banks to fund acquisitions, the market is evolv - ing, and participation by Indian banks may increase. As private credit is at a nascent stage in India, there has not yet been a significant number of private credit transactions refinanced by borrowings raised from banks and the public bond market. However, it is anticipated that the next couple of years will witness an upturn in such refinancing, where the banks are permitted to refinance within the regulatory framework of the RBI. 1.3 Acquisition Finance As mentioned in 1.2 Interaction With Public Mar- kets , financing for a domestic acquisition has gen - erally been from non-banking financial companies (NBFCs) or through the issuance of non-convertible
The private credit market in India has been on a steady upwards trajectory. According to publicly available data, private credit deals witnessed a 53% increase on a deal value basis in the first half of financial year (FY) 2025–26 (compared to the same period in the previous FY). The deal value in the first half of FY 2025–26 aggregated to approximately USD9 billion across more than 75 deals. The push from the Indian government towards the development of infrastructure and manufacturing in India has provided a conducive environment for growth of the private credit market in India. The pro - jected growth trajectory of the Indian economy has also garnered interest in the Indian market among global private credit players. In 2025, the infrastructure sector led the way, followed by real estate, financial services and healthcare. With the overall positive outlook, the requirement of growth capital and the availability of surplus dry pow - der, the Indian private credit market is set to grow exponentially in the next few years. 1.2 Interaction With Public Markets The Indian debt market is dominated by Indian banks, with the major players being the public sector banks and other private banks. The Reserve Bank of India (RBI) is the central bank of India and regulates Indian banks. Under the Indian banking regulations, Indian
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