Private credit’s software blind spot sparks fresh fears for $3 trillion sector

Private credit markets are facing fresh uncertainty as AI-driven tools start to pressure software companies, a major borrower group for private lenders.

The software industry came under renewed pressure last week after artificial intelligence firm Anthropic unveiled new AI tools, sparking a sell-off in software data provider shares.

The AI tools, developed by Anthropic, are designed to perform complex professional tasks that many software companies currently charge for, raising fresh concerns that AI could weaken traditional software business models.

Shares of asset managers with large private credit franchises tumbled this week as investors fretted about how AI could upend borrowers’ business models, pressure cash flows and ultimately lift default risks.