In part 1 of our Confluence in Private Equity series, we unpacked why private credit is gaining ground in Africa, particularly the shift toward more flexible structures and the appetite for alternative capital in a high-interest-rate environment. That momentum is not theoretical; it is playing out in real time through the managers who are actively deploying capital across the continent.

Part 2 takes the conversation further with insights from several leading African credit fund managers. They share what they are seeing on the ground, including tighter credit selection, rising demand from mid-market borrowers and the growing focus on governance and risk discipline as deal volumes increase. Their experiences offer practical insights into how private credit is evolving and what investors should be watching in the months ahead.

Across the six fund managers, private credit is framed as a durable complement to bank lending rather than a zero-sum rival. Kasief Isaacs, CEO of Creation Capital, notes: "We see traditional bank lending and private credit mostly as complementary, with banks, DFIs and asset managers sitting comfortably alongside each other as co-lenders on large infrastructure transactions".

Norsad Finance’s CIO Nathaniel Nyika adds: "Highly regulated bank lending limits its capacity to reach specific credit opportunities where private credit can invest", positioning private debt as a bridge between senior debt and equity in Africa’s growth markets.

From a global lens, Skybound Capital’s Werner Gerber expects private credit’s role to remain 'structurally durable', supported by bank retrenchment, investor demand and refinancing needs, even if growth moderates as markets normalise.

William Macrobert, CEO of Stockhouse Capital, highlights the growth opportunity in the residential market as banks struggle to provide speed and flexibility: "The residential sector has just emerged from a tough period, but Q4 2025 signals a systematic shift in consumer demand. We are seeing stronger buyer interest, with demand for residential properties steadily rising. In our market segment, this is driving above-average growth in private credit, largely because traditional banks cannot compete effectively with the flexibility and speed we provide."

He adds that private credit in this space is not aimed at the unbanked, but at good bankable clients: "Developers prefer the agility we provide, allowing them to adjust selling prices to match building costs and optimise returns, rather than being constrained by bank policy and regulation."

Managers converge on a clear view: technology doesn’t replace fundamental judgment, it amplifies it. Creation Capital has embedded AI to automate the ingestion of management accounts, covenant certificates and ESG metrics, and to standardise historic and forecast analysis for rigorous early credit scoring. Skybound describes a similar shift: machine learning, NLP and real-time operational data are enriching underwriting and monitoring; early-warning systems catch risks faster; and processes are streamlined without sacrificing human oversight. RisCura argues that robust monitoring systems, documented internal ratings and repeatable risk tracking are the bedrock of private credit, especially when investing through specialist managers. Stockhouse Capital also notes the value of local, on-the-ground intelligence in credit assessment, particularly in residential lending, where understanding pre-sales, construction timelines and market sentiment allows for more accurate risk pricing and deal structuring.

On deal terms and competition, Stockhouse Capital observes: "Competition among private lenders in the residential sector remains low, but is expected to increase as the market recovers. Our approach is to provide fair risk-adjusted pricing that benefits both the client and the lender. Clients in this segment are loyal; if treated fairly and consistently, they return for repeat business rather than shopping around."

This mirrors a broader theme among managers: balancing returns with client alignment.

Democratising access is a shared ambition, but managers are careful to align product design with the realities of illiquid loans. Creation Capital plans to broaden institutional access in early 2026, with retail access expected 18–24 months thereafter, driven in part by younger investors seeking strategies that marry returns with measurable impact. Skybound anticipates retail access expanding through interval funds and digital platforms, provided that investor education and liquidity terms are crystal clear. Tokenisation is on the horizon, with Skybound calling it "an early but promising innovation" that could lower minimums and improve transferability, while advocating prudence until regulatory clarity and platform robustness improve.

Higher rates and shifting policy settings are pushing managers toward floating-rate, short-tenor loans, tighter structures and stronger borrowers. Skybound’s approach: avoid duration, keep collateral robust and covenants meaningful, and run scenario and reverse-stress tests to pre-empt de-risking. Norsad is steering clear of more than 5-year tenors and highly leveraged stacks, favouring stretch-senior with pari passu ranking over subordinated or mezzanine cashflows deeper in the waterfall. Sector stance is equally deliberate: Norsad flags microfinance and agriculture as challenged, while Skybound avoids pockets of commercial real estate and legacy low-rate loans where spreads fail to reflect mounting risks. Stockhouse Capital highlights that in residential lending, private credit returns are broadly predictable and sustainable when structured properly: higher volumes can be achieved without materially increasing risk, provided pricing and pre-sale diligence are robust.

Liquidity, alignment and impact: getting the plumbing right

Private credit’s illiquidity premium only works when fund terms match portfolio realities. Skybound emphasises clear redemption terms aligned to loan tenors, liquidity buffers to manage orderly exits, and proactive education so investors understand the yield-illiquidity trade-off long before they redeem. RisCura brings an operator’s focus: "Liquidity needs to be built into the structure upfront and communicated clearly", pairing short-term exposures with longer-dated positions to meet smaller liquidity events without destabilising the fund. Managers also stress alignment and measurement: GP co-investment, LP-friendly fees and hurdles, and unified impact indicators across managers to track outcomes such as jobs, inclusion and renewable energy.

Two opportunity sets stand out: SME lending in South Africa and venture debt. RisCura notes that improving fundamentals and the recent sovereign upgrade could create mispriced opportunities for lenders willing to do rigorous, on-the-groundwork. Edge Venture positions venture debt as a flexible, non-dilutive instrument for VC-backed, high-growth firms, term loans, working-capital lines, equipment finance or revenue-based facilities, with equity kickers to balance risk. "Venture debt does not replace equity; it amplifies it", says Janice Johnston of Edge Venture.

If part 1 captured the currents pushing private credit to the fore, part 2 shows how leading managers are building the channels: embedding technology to see risk sooner; designing products that balance yield and liquidity; setting clear redemption expectations; and opening new pathways: tokenised access, SME lending, venture debt, without loosening guardrails. The result is an asset class moving from promise to practice: more inclusive, more disciplined, and better able to deliver both returns and real-world outcomes across Africa’s economies.

This article draws on insights shared in a Q&A with:

• Creation Capital: Kasief Isaacs, Chief Executive Officer (read more)
• Norsad Finance: Nathaniel Nyika, Chief Investment Officer (read more)
• Skybound Capital: Werner Gerber, Group Head of Investment Solutions (read more)
• RisCura Impact Debt Fund: Heleen Goussard, Portfolio Manager (read more)
• Edge Growth Ventures: Janice Johnston, Chief Executive (read more)
• Stockhouse Capital: William Macrobat, Chief Executive Officer (read more)

Written by Michael Denenga and Gitte Trute from Webber Wentzel