India's Private Credit Market to Remain Strong, Real Estate Leads in H1 2026
• India's private credit market is projected to stay robust over the next two years, as per an EY survey. In H1 2026, private credit investments reached $3.5 billion, with domestic funds accounting for 74% of the total deal value. The real estate sector led the market, contributing 35% of the deal value, followed by healthcare at 13%. The banking sector also showed improved financial health, with a Capital to Risk-weighted Assets Ratio (CRAR) of 17.7% as of March
• Asset quality improved, with the gross non-performing asset (GNPA) ratio declining to 1.8%.
Impact & Risks
The growth in private credit is expected to benefit sectors like real estate, healthcare, and food & beverage, which have seen increased activity. However, the real estate sector remains a high-risk area for defaults. Rising competition in the private credit market could also impact returns for investors. The overall resilience of the banking sector provides a stable foundation for continued credit expansion.
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