Lenders Open Credit Spigot Wider, Even As Delinquencies Edge Higher
By CU Today Staff —
CHICAGO—U.S. lenders are becoming more aggressive about extending credit, with credit card originations climbing nearly 12% and personal loan originations nearly 20% as lenders increasingly pursue growth while attempting to contain risk, according to new TransUnion data.
TransUnion's Q2 2026 Credit Industry Insights Report found 261.7 million consumers now carry a credit balance, up 2.4% from a year earlier, while total outstanding balances increased 2.8% to $18.6 trillion. Despite continued affordability pressures, TransUnion said the expansion has not translated into materially greater portfolio risk, with balance-level delinquency at 1.98%, down two basis points.
“This continued expansion in credit access shows that lenders are still extending credit broadly across the market,” said Jason Laky, executive vice president and head of financial services at TransUnion. “Lenders are managing risk through the use of strategies such as smaller credit lines, which allows them to continue expanding access to credit while navigating a complex economic environment.”
That shift is particularly evident in credit cards. Bankcard originations jumped 11.8% year over year to 20.6 million, marking a sixth consecutive quarter of growth, while total balances increased 4.4% to $1.14 trillion. Credit lines associated with new accounts surged 20.9% as lenders increased both account acquisition and lines across all risk tiers. Borrower-level 90-plus-day delinquency, however, edged up to 2.26% from 2.17% a year earlier.
“The bankcard market has entered a new phase of growth. After more than a year of tightening, card issuers are expanding access across the credit spectrum, reflecting a larger non-prime borrower population. Lenders appear increasingly comfortable pursuing growth opportunities while maintaining a disciplined approach to risk management," said Paul Siegfried, senior vice president, credit card business leader at TransUnion.
The expansion is even more pronounced in unsecured personal lending, where outstanding balances reached a record $281 billion, up 9.6%, while originations rose 19.5%. Growth is increasingly reaching riskier borrowers: subprime borrowers and accounts increased 18.4% and 20.5%, respectively, although lenders reduced the average size of new subprime loans by 6.8%. Borrower-level 60-plus-day delinquency rose to 3.81% from 3.37% a year earlier.
“Lenders are reaching more consumers than ever, particularly at the subprime end, but they are doing it with smaller loan sizes and tighter underwriting — and it shows in the performance data. Delinquency is rising on a per-borrower basis simply because more non-prime consumers are entering the market, yet on a balance-weighted basis, risk has actually held flat. That is precisely what disciplined expansion is supposed to look like,” said Josh Turnbull, senior vice president, consumer lending business leader at TransUnion.
Elsewhere, mortgage originations climbed 26% year over year to 1.24 million in the first quarter, aided by refinancing and increased participation by Gen Z and Millennial buyers, although 60-plus-day mortgage delinquency rose 29 basis points to 1.56%. Auto lending presented a more difficult affordability picture: monthly payments are now 38.7% higher for new vehicles and 39.6% higher for used vehicles than in 2019, while serious auto delinquency remained elevated.
Originally reported by CU Today.