Canadian Businesses Reliant on Traditional Financing Despite Global Private Credit Growth

The Bank of Canada has released an analysis of the private credit market, highlighting its limited role for Canadian businesses but significant exposure of domestic investors abroad.

According to the report, while private credit has grown rapidly worldwide, Canadian businesses still rely primarily on banks and public debt markets. In fact, non-bank loans to Canadian businesses have remained stable at around 15% over the past decade, indicating that private credit has not displaced traditional financing sources.

In contrast, the United States has seen private credit emerge as a viable alternative, with many Canadian investors participating in global private credit markets. The Bank estimates that combined private lending by Canadian investors and loans to private credit funds by Canadian banks totaled around $500 billion at the beginning of 2026.