Key Takeaways
- • StepStone Group and Dubai-based ASB Capital have launched an open-ended Sharia-compliant private credit fund targeting senior secured lending to US middle-market businesses.
- • The partnership represents an expansion of Sharia-compliant investment vehicles into the US private credit market, addressing demand from Islamic finance allocators.
- • The fund's open-ended structure allows for continuous investor inflows and deployments, contrasting with traditional closed-end private credit funds.
- • Senior secured lending focus positions the fund in a lower-risk segment of the private credit spectrum, appealing to conservative institutional allocators.
Summary
StepStone Group, a major alternatives asset manager, has partnered with ASB Capital, a Dubai-based investment firm, to create a Sharia-compliant private credit fund structured as an open-ended vehicle. The fund targets senior secured lending opportunities within the US middle-market segment, combining Islamic finance principles with exposure to the growing private credit asset class.
The partnership reflects institutional investor appetite for Sharia-compliant alternatives in North America, where such vehicles remain relatively scarce compared to traditional private credit offerings. By targeting senior secured debt—typically the lowest-risk tranche of the private credit market—the fund positions itself to attract conservative institutional allocators, including Islamic financial institutions, sovereign wealth funds, and family offices with Sharia-compliant mandates.
The open-ended structure differentiates this offering from the closed-end fund model that dominates private credit fundraising. This format enables ongoing capital raises and deployments rather than a fixed fundraising period, providing flexibility for both investors seeking continuous exposure and managers deploying capital into mid-market lending opportunities across the US economy.
The partnership reflects institutional investor appetite for Sharia-compliant alternatives in North America, where such vehicles remain relatively scarce compared to traditional private credit offerings. By targeting senior secured debt—typically the lowest-risk tranche of the private credit market—the fund positions itself to attract conservative institutional allocators, including Islamic financial institutions, sovereign wealth funds, and family offices with Sharia-compliant mandates.
The open-ended structure differentiates this offering from the closed-end fund model that dominates private credit fundraising. This format enables ongoing capital raises and deployments rather than a fixed fundraising period, providing flexibility for both investors seeking continuous exposure and managers deploying capital into mid-market lending opportunities across the US economy.
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