How to Read a Private Credit Term Sheet (HNI Edition)

Private credit has become one of India’s fastest-growing AIF categories — but understanding a deal starts with understanding the term sheet. For HNIs, this is where risks, protections, and return drivers are hidden.

Key components include the coupon structure, which may be fixed, floating, or split between cash and PIK. The security package outlines what protects your capital — collateral, escrow accounts, promoter guarantees, or cash-flow controls.
Then comes covenants, the rules borrowers must follow; strong covenants reduce downside risk.

Other elements like tenor, prepayment clauses, waterfall priority, and exit rights determine how and when capital returns.
A well-structured term sheet tells you everything about risk — long before returns are discussed.

Truvest Insight:

Never judge a private credit deal by yields. Judge it by protections.

Disclaimer:

Educational only. Not investment advice.