What Griffin and Dimon are actually warning about

Griffin's comments, made in an interview with the Financial Times published on 29 April 2026, centre on a structural mismatch. Semi-liquid private credit funds promise investors periodic redemption windows, yet the underlying loans are long-duration and illiquid. When too many investors head for the exit at once, fund managers face a choice: sell assets at a discount, gate withdrawals, or both.

"The real issue here is the liquidity mismatch between the retail investor and the duration of the investments. We live in a world where retail investors have become accustomed to having immediate liquidity for their investments… investing in private credit is a different story."

Griffin questioned whether retail investors truly understood "the nature of the investment they were making," according to City A.M.'s report of the FT interview.

JPMorgan chief executive Jamie Dimon has struck a similar tone. In his annual letter to shareholders, Dimon warned that losses for lenders to highly indebted companies will be higher than many expect because of weaker lending standards. Speaking at the Norges Bank Investment Management Conference on 29 April, he added that a potential credit recession "will be worse than people think," as reported by City A.M.

Goldman Sachs president and chief operating officer John Waldron offered a more nuanced critique. Speaking at a Semafor event earlier in April, he placed blame on fund managers rather than investors, saying: "Not everybody has marketed their product as clearly as, certainly we would like to see with the clarity that this is really not a liquid product. It's not semi-liquid. It's really illiquid."

Retail investors now account for roughly a fifth of the private credit market's size, according to Waldron, up from a negligible share before 2021.

Where the redemption pressure is showing up

Semi-liquid private credit funds have attracted nearly $200bn (approximately £148bn) since 2021, according to City A.M. That rapid growth created a large base of investors who expected regular access to their capital.

The first visible crack appeared at Blue Owl Capital, which limited withdrawals from two of its flagship funds after a wave of redemption requests. The firm had aggressively courted retail investors, and the pressure proved too great to absorb. Rating agency Moody's subsequently cut its outlook on Blue Owl from stable to negative this month, citing persistent redemption requests that it expects to "persist in the coming quarters," alongside potential slowing of inflows.

Other major alternative investment firms, including Blackstone, Apollo, and KKR, have also felt pressure across funds aimed at wealthy individuals, according to City A.M.

Goldman Sachs's own semi-liquid private credit fund saw redemptions rise from 3.5% of assets in Q4 2025 to just under 5% in Q1 2026. The firm said this remained below the industry average and confirmed that all redemption requests were honoured. That the industry average sits above 5% gives some indication of the scale of outflows elsewhere in the sector.

What a private credit squeeze means for mid-market borrowers

The Wall Street debate has focused almost exclusively on investor protection and fund governance. What it has largely ignored is the lending side of the equation.

Private credit has grown to rival syndicated lending as a funding channel for mid-market and leveraged buyout transactions. In the UK, non-bank lenders have become a significant source of capital for SMEs and scale-ups that find traditional bank lending too slow, too restrictive, or simply unavailable.

When semi-liquid funds face sustained redemption pressure, several things happen on the lending side.

New origination slows

Fund managers dealing with outflows have less capital to deploy. If inflows slow simultaneously, as Moody's has flagged in Blue Owl's case, the lending pipeline tightens. Borrowers who expected to refinance with a private credit provider may find that the term sheet arrives later, with worse terms, or not at all.

Pricing rises

Lenders still willing to originate will demand higher spreads to compensate for their own funding uncertainty. For mid-market borrowers already paying a premium over syndicated loan rates, this raises the cost of capital at a time when Bank of England base rates remain elevated.

Covenant terms tighten

Dimon's warning about weaker lending standards cutting both ways is relevant here. As defaults begin to surface in private credit portfolios, surviving lenders will tighten documentation. Borrowers accustomed to the covenant-lite structures that characterised the 2021 to 2024 vintage may face more restrictive terms on maintenance covenants, reporting obligations, and permitted indebtedness.

Secondary market effects

If fund managers are forced to sell loan positions to meet redemptions, those assets trade at a discount. This reprices comparable credits across the market. A UK mid-market company with an existing private credit facility may find its next financing round benchmarked against distressed secondary pricing rather than par.

None of this requires a systemic crisis. A sustained period of elevated redemptions, even if all requests are honoured, is enough to shift lending behaviour.

Questions operators should ask their boards now

For UK SME founders, finance directors, and board members, the private credit liquidity debate is not abstract. It touches at least two practical areas: the funding side and the investment side.

On borrowing

Any business with an existing private credit facility, or one in negotiation, should understand who the ultimate capital provider is. If the lender is a semi-liquid fund facing redemption pressure, the commitment to fund future drawdowns or refinance at maturity may be less certain than the documentation implies. Boards should ask their advisers whether the lender's fund structure has experienced gating or elevated redemptions.

Businesses planning to raise debt in the next 12 to 18 months should consider whether alternative sources, including bank lending, asset-based finance, or development finance, provide more certainty of execution, even at a marginally higher headline cost.

On treasury and pension allocations

Some UK SMEs and scale-ups have allocated treasury reserves or defined benefit pension scheme assets to private credit vehicles, attracted by yields that sit above investment-grade fixed income. Boards with such exposure should stress-test the redemption terms. Key questions include: what is the maximum quarterly redemption rate the fund permits? Has the fund approached or breached that limit? What happens if the fund gates?

Waldron's observation that private credit is "really illiquid" rather than semi-liquid should inform any board discussion about matching asset liquidity to the organisation's own cash-flow needs.

On scenario planning

The worst outcome for a mid-market borrower is discovering that its lender cannot or will not refinance at the same time that its own treasury allocation to private credit is locked up. Boards should map both exposures together and consider whether the correlation risk is acceptable.

Griffin, Dimon, and Waldron are debating the health of a $1.7 trillion asset class. For UK operators, the question is narrower but no less important: can the capital that has been promised, both to and by the business, actually be accessed when it is needed?