The higher rates paid to the investors in private credit are supported by charging higher rates to those borrowing the money. Independent financial planner Andy Darroch said the very existence of the private credit market should be a warning sign for potential investors. The Australian Securities and Investments Commission has put the private credit sector on notice that it is closely monitoring its end-of-year reporting. “There’s a fundamental timeline mismatch between the expectations of investors and where the money’s invested,” Mr Darroch said. This scenario has already been playing out in the US, with some very large private credit funds severely restricting the amounts investors can access.