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ELTIF 2.0 funds take off with 80 launches in just over a year
by Lisa Fu
European regulators may have finally got it right. New private credit funds under a revised framework have surged, making the asset class accessible to a wide range of investors across Europe.
In February, Muzinich & Co launched a direct lending fund for retail investors under the new European Long Term Investment Fund (ELTIF 2.0) regulations. Meanwhile, AXA Investment Management Alts debuted its first evergreen private credit fund in January. And StepStone Group said it intends to market a private debt-focused fund targeting wealthy individual investors this year.
That’s a marked shift. Under ELTIF 1.0, there were only 80 fund launches from 2015 to 2022. In barely more than a year under ELTIF 2.0, Europe has matched that amount, according to Stephane Blanchoz, head of alternative solutions at BNP Paribas Asset Management.
Tom Alabaster, head of the EMEA funds practice for Ropes & Gray, said: “ELTIF, in its 2.0 form, appears to have developed into a suitable fund product for asset managers with long-term illiquid asset strategies seeking to tap into the retail investor market.”

There is no minimum investment under ELTIF 2.0
Matthias Kerbusch
Partner
Dechert
Regulators introduced ELTIF to encourage investment in the European economy and spur growth in infrastructure and smaller companies. But the framework gained little traction due to restrictions around distribution, minimum investor commitments and eligible investments.
Last year, the European Commission decided to try again after asset managers advocated for fewer restrictions. Key changes include the ability for the new funds to be evergreen with monthly subscriptions and quarterly redemptions, as well as an EU passport scheme that allows managers to distribute products across country borders.
“There is no minimum investment amount anymore under ELTIF 2.0,” said Matthias Kerbusch, partner at Dechert. “You can also distribute it, similar to UCITS, through banks. The real beauty is the passport. Once the ELTIF is approved... countries cannot put up individual rules to curtail distribution.”
ELTIF 2.0 also broadened the scope of eligible investments, allowing for investment across all private market asset classes. There is flexibility around holdings and a focus beyond European infrastructure and private equity.
“[Funds] can invest not only in infrastructure but in private credit deals,” Kerbusch said.
Investments are also no longer limited to companies with a market cap under EUR 500m.