Cross-border private credit transactions are poised for strong growth, yet operational complexity is emerging as a critical hurdle, according to business administration and compliance solutions provider CSC’s ‘Private Credit 2025: Global Strategies for a $1.5 Trillion Market’ report.
The findings highlight a growing disconnect between investors and fund managers as private credit continues its rapid international expansion.
While both LPs and general partners (GPs) remain optimistic about the growth of cross-border private credit, they diverge sharply when it comes to operational readiness. Nearly eight in 10 GPs (79%) anticipate growth in the sector over the next three years, with more than half (51%) expecting a significant acceleration. LPs, however, are increasingly cautious — 40% reported turning down multiple fund or investment opportunities last year due to operational concerns such as inconsistent reporting standards and unclear risk frameworks.
GPs recognise the operational challenges that come with cross-border expansion — particularly around anti-money laundering (AML) regulations, multijurisdictional reporting, and enforcing covenants across diverse legal systems. Transparency and reporting demands from LPs now rank among managers’ top concerns, second only to the complexity of deal structuring.
At the same time, LPs are shifting their priorities toward more granular and consistent data on loan performance and borrower credit quality. These metrics now rank just behind loan-level returns and borrower payment trends, while broader measures such as liquidity and portfolio risk visibility are being assessed through this data.
To meet rising expectations and scale effectively, many GPs are investing in technology upgrades and partnering with specialist service providers. Currently, 82% rely on third-party loan agents, with 66% doing so regularly over the past year, and 88% expect usage to increase. LPs endorse this shift: 92% believe GPs who outsource to trusted specialists are better equipped to deliver enhanced reporting and risk transparency, especially in complex cross-border environments.
