Securities and Exchange Commission chair Paul Atkins has told retail investors to avoid private credit if they cannot stomach potential losses, calling it a high-risk asset class. Speaking at IMF spring meetings in Washington, Atkins said the $1.8 trillion private credit market requires investors who can handle volatility and potential losses.

Atkins' comments come as regulators push to expand access to private credit through retirement accounts, with the US Labor Department proposing rules to make it easier for 401(k) plans to include such investments. The move follows President Trump's executive order encouraging alternative assets in retirement savings. Critics argue private credit's illiquid nature makes it unsuitable for retail investors who need quick access to funds.

Major private credit firms including Apollo Global Management, Blackstone, and KKR have faced $20.8 billion in redemption requests in early 2025, honoring only about half. While Atkins dismissed systemic risk concerns, Bank of England governor Andrew Bailey identified private credit as a key vulnerability in global finance, citing liquidity mismatches and opacity. The debate highlights tensions between expanding investment opportunities and protecting retail investors in increasingly complex markets.