In opaque markets plagued by asymmetric information, firms borrow from many lenders at once and individual contracts are not observable to other lenders. We identify a novel information externality in a model based on such a setting. To avoid adverse selection, lenders use their private information to adjust the size of loans rather than the prices they offer to borrowers. Each lender's individual rationing decision creates an information externality that raises other lenders' profits, even though information is not shared and lenders compete with each other. The model provides a new microfoundation for peer monitoring in opaque credit markets and has implications for their optimal structure.