Why experience matters in private credit
As private credit expands, experience in disciplined, asset-backed lending is proving more valuable than scale alone.
As 2025 draws to a close, private credit has become a defining feature of global finance. Institutional investors, asset managers, and alternative lenders have expanded into this space, attracted by yield and the security of tangible collateral.
According to Wellington Management’s 2025 Private Credit Outlook, the global opportunity exceeds $30tn (£22.7tn). The scale is vast, but the differentiator will be who lends well, not just who lends big.
Experience and discipline now matter as much as capital. Since 2013, FOLK2FOLK has built a proven model of property-secured lending to SMEs, long before “private credit” became the term of the moment. With more than £785m lent, it is the UK’s largest peer-to-peer lender to business and a clear example of private credit in practice.
The evolution of P2P and private credit
Over the past decade, peer-to-peer lending has matured from a grassroots movement into a regulated, professional market within the broader private credit landscape.
With a shared focus on secured, productive finance, the boundaries between P2P platforms, private-credit funds, and asset-based lenders have narrowed – a healthy sign that capital can reach the real economy through multiple disciplined routes.
Private credit has also attracted an influx of new capital and managers still building operational depth in direct lending. Experience in disciplined, asset-backed lending will increasingly separate those who lend well from those who simply deploy capital.
Why real-economy lending matters
At a time when policymakers call for more domestic investment and banks remain cautious, the role of secured, non-bank lenders is essential.
At FOLK2FOLK, every loan is secured against property. Loans are fixed-rate, interest-only, with loan-to-value ratios typically around 60%. This provides borrowers with accessible capital and gives investors transparency over the underlying asset.
This isn’t abstract finance; it’s real businesses and real assets driving real outcomes. Whether it’s a farmer diversifying into agri-tourism, a manufacturer expanding capacity or a developer regenerating a local site, these loans sustain jobs and strengthen regional economies.
Lessons from 2025
This year has reminded lenders that private credit, like all finance, moves with the economic cycle. Across the market, there are signs of borrower strain and sharper focus on credit quality.
For FOLK2FOLK, these conditions reinforce the importance of fundamentals: strong security, sensible loan-to-values, and transparency at every stage. These principles enable prudent portfolio management, agility in response to change, and continued support for borrowers and investors.
Looking ahead
Private credit is entering a phase of expansion and scrutiny. As more entrants join, investors and regulators are watching how risk is managed and returns generated.
FOLK2FOLK’s appeal is that it represents a form of private credit that is transparent, asset-backed, and rooted in the real economy.
As private credit evolves, its credibility will depend less on how much capital is deployed and more on how prudently it is lent. The next stage will favour those who combine operational experience with responsibility, and it will be those who will help shape what sustainable private credit looks like in the years ahead.
Article originally published in Alternative Credit Investor on 22nd December 2025.
