When Lloyds Development Capital, the private equity arm of Lloyds Banking Group, assembled its financing package to buy UK restaurant group D&D last year, the firm did not look to its parent group or its banking rivals to provide the key ingredient, leverage. In a sign of the times, the firm turned to one of Europe’s new private debt funds for the loan.

LDC's decision to finance the £50 million D&D deal with non-bank lenders demonstrates the growing influence of new credit providers, as mid-market companies across Europe feel the pinch while banks cut their lending. Mid-cap companies say they are unable to access the same amount of bank credit as they once were - leaving a gaping hole in the market for new entrants.