New Delhi, April 8 The country's private debt market is gaining momentum, with venture debt deployments reaching USD 1.3 billion and growth credit at USD 1.68 billion in 2025, signaling a structural shift in startup financing, according to a report released by Stride Ventures on Wednesday.
Private debt is increasingly moving beyond its traditional role of extending runway to support expansion, acquisitions, and capital structuring, it added.
According to Stride Ventures' Global Private Debt Report 2026, venture debt deployments reached about USD 1.3 billion across nearly 187 startups in 2025, reflecting growing institutional acceptance of non-dilutive capital.
Activity remained concentrated in major startup hubs, with Delhi-NCR leading at USD 617 million across 64 deals, followed by Bengaluru at USD 333 million across 58 deals, and Mumbai at USD 115 million across 30 deals.
Sector-wise, fintech accounted for the largest share of capital deployment at over USD 600 million, while consumer-focused startups led in deal volume (60).
Alongside this, growth credit is emerging as a complementary layer in the capital stack, particularly for late-stage companies. Indian firms raised about USD 1.68 billion through growth credit across 32 deals in 2025, with Mumbai leading in both deal count and capital deployed.
Fintech also dominated growth credit, accounting for 59 per cent of total capital deployed, followed by consumer at 13 per cent, and B2B at 11 per cent.
The report highlighted that venture debt has expanded significantly over the past decade, with annual deployments rising from USD 80 million in 2018 to USD 1.3 billion in 2025, marking a more than 16-fold increase and a compound annual growth rate of about 37 per cent.
Venture debt now accounts for around 9 per cent of total venture capital deployment annually, compared to about 2-3 per cent historically, suggesting rising founder acceptance of non-dilutive capital.
Stage-wise, venture debt remains concentrated in Series A and B funding rounds, accounting for about 60 per cent of deal activity. However, later-stage companies (Series D and above) account for a disproportionate 32 per cent of capital deployed, reflecting larger ticket sizes and higher lender confidence.
"Growth credit is now emerging as companies reach late-stage scale, supported by improving cash flows, increasing institutional participation, and faster growth cycles driven by AI, IPOs, and fintech and digital innovation. These facilities are typically larger and more structured, supporting platform expansion, acquisitions, and lending-book growth," the report said.
The report also noted that venture debt caters to earlier-stage, high-growth firms, while growth credit is emerging as a more structured financing tool for larger, late-stage transactions.
It further said that over 70 per cent of founders surveyed expect private debt usage to increase over the next two years, signalling a shift toward including it as a core component of the capital stack.
Looking ahead, demand for private debt is expected to remain broad-based, with consumer platforms likely to attract the highest share, followed by fintech and B2B enterprises. Private equity investors, meanwhile, expect growth credit demand to be driven by sectors such as energy, infrastructure and industrials, the report said.
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