Private credit has emerged as one of the fastest-growing asset classes, expanding nearly tenfold to approach $2 trillion by the end of 2023. While the initial growth was driven largely by leveraged loans and direct lending, a new chapter is unfolding with asset-based finance (ABF) playing a pivotal role. Within ABF, equipment financing stands out as a resilient, scalable, and high-potential opportunity.

As banks adopt more conservative lending postures, equipment financing offers private credit firms a robust alternative that aligns with investor demand for stability and attractive returns. Two illustrative case studies demonstrate why equipment finance is not just a temporary phenomenon but a foundational pillar of private credit’s next era.