# Private Credit Industry Group Says Default Fears Are 'Divorced From Reality'

> The Alternative Credit Council pushed back on growing market anxiety about private credit, pointing to 17% asset growth even as it acknowledged AI-related concerns have made lenders warier of software borrowers.

- Source: Principle Post
- Canonical URL: https://principlepost.com/article/private-credit-alternative-credit-council-market-fears
- Author: Principle Post Staff
- Section: Markets
- Published: 2026-10-22T18:08:00.000Z
- Updated: 2026-10-22T18:08:00.000Z
- Tags: private credit, Alternative Credit Council, business development companies, credit markets, AI disruption

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The private credit industry's main trade group is pushing back on what it calls an overly bleak narrative about the asset class, arguing that public anxiety about defaults and deterioration has become "divorced from the market-wide reality." The Alternative Credit Council, which represents private credit fund managers, pointed to continued growth in the industry as evidence its underlying health remains solid.

## Growth versus "concentrated" stress

The council's report cites a 17% year-over-year increase in assets under management, to $4.1 trillion, as a sign the sector is still expanding even amid headline-grabbing worries about troubled loans. The group argues that the pressures showing up in parts of the market are "concentrated rather than indicative of broader market deterioration."

Still, the report doesn't dismiss every concern. It acknowledges that fears about AI's potential to disrupt software companies — among private credit's biggest borrowers — have driven investors to pull cash from business development companies, a popular vehicle for retail exposure to the asset class. In response, the council said, lenders have begun demanding additional covenants, raising loan spreads, or in some cases declining to extend maturities for borrowers seen as most exposed to AI disruption.

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Originally published by Principle Post. Free to cite with attribution and a link to https://principlepost.com/article/private-credit-alternative-credit-council-market-fears.