China's private credit market has significant structural differences from those in the U.S. and Europe. It lacks alternative investment funds and direct lending, is heavily regulated, and banks remain key players. We estimate the China market has shrunk to RMB21 trillion as of Dec. 31, 2024, nearly half its size since 2017. The decline comes on the back of new regulations, increased competition from local bond markets, and compressed margins. A combination of softening demand and disruption in supply from lenders will likely lead the overall size of the private market to further contract. Click below to read full report
20250417_creditfaq_thecontractionofchina-sprivatecreditmarket.pdf
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