NEW YORK: New money flows into a popular category of private credit funds ​for wealthy investors dropped ⁠by 45% in the first three months of this ‌year from the same period of 2025, according to data released on Wednesday ​by specialist investment bank RA Stanger. Fears about artificial intelligence disrupting software businesses have filtered through ​to the ​private credit and private equity firms that lent to and bought them during many years of low interest rates. Questions have ⁠also been raised about lending standards and the transparency of valuation practices.

As doubts boiled up, sales for non-traded business development companies (BDCs), which raise equity and pair it with leverage to lend to private companies, reached $8.9 billion versus $16.3 ​billion in ‌the first ⁠three months of ⁠last year, the data showed.

“The capital rotation out of private credit is no ​longer emerging — it's firmly underway,” Kevin Gannon, chairman ‌and CEO of Stanger, which tracks so-called alternative ⁠assets, which include private equity and private credit, said in a statement.

At the same time, more money flowed into strategies focused on hard assets that are seen as facing less risk of obsolescence as technology advances, Stanger said. Real estate funds welcomed 26% more new money than in the same period of the previous year, and infrastructure funds grew 14%, the data showed.

Stanger tracks 23 publicly ‌registered BDCs, and 106 privately offered versions, which carry a ⁠higher minimum wealth threshold for investment. It does ​not count the listed BDCs which trade on public exchanges. Alternative asset managers have increasingly looked to raise money from wealthy individuals in recent years. ​U.S. President Donald ‌Trump has sought to promote the inclusion of ⁠less liquid assets into American ​retirement plans. (Reporting by Isla Binnie; Editing by Daniel Wallis)