Editor's Note: CUInsight is hosting a FREE WEBINAR Wednesday, April 8 titled, “Delinquencies on the rise: Discover the winning formula for staying ahead”. We hope you’ll join us!
Members are signaling a blend of resilience and strain across their household finances. Credit unions can see it in the mix of growing card use, uneven savings cushions, and stress pockets in auto and student loans. Recent federal datasets help separate noise from signal and point to practical steps that improve member outcomes and portfolio performance.
Credit use stays elevated while carrying costs bite
Card use remains high, and the cost of revolving balances is still a pain point. The Federal Reserve’s G.19 report shows consumer credit rose in 2025, including growth in revolving credit, while average interest on credit card plans hovered around the low‑20 percent range, a combination that can extend payoff timelines for revolvers and raise delinquency risk if income softens.
The New York Fed’s Household Debt and Credit report confirms that card balances ended 2025 at approximately 1.28 trillion dollars, up year over year, reinforcing the need for strong payment‑plan options and early outreach for at‑risk members.
Auto and student loans are key stress amplifiers
Auto performance has become a central watch item. While originations in recent years skewed toward higher‑score borrowers, the New York Fed’s Liberty Street Economics finds delinquency transition rates have risen across score bands and income levels, with notable concentration among non‑captive finance lenders.
Student loans also matter for the payment hierarchy. After the resumption of reporting in 2025, the New York Fed noted elevated student loan delinquency, which can crowd out other obligations and accelerate roll rates if cash flow is tight.
BNPL growth complicates visibility
Short‑term installment credit continues to expand outside of traditional reporting channels. The Consumer Financial Protection Bureau documents growth in Buy Now, Pay Later usage through 2023, which can obscure a member’s full debt picture if lenders rely only on bureau‑visible tradelines.
The CFPB’s matched‑sample research further shows BNPL users are more likely to carry card balances and have existing delinquencies, indicating potential stacking and liquidity risks that warrant direct questions during reviews and targeted member education.
Income gains are modest, and savings are thin
Real earnings improved modestly year over year into early 2026, but monthly progress has been uneven, which can lead to irregular repayment timing even for otherwise healthy members.
At the same time, the personal saving rate hovered around the mid‑3 percent range late in 2025, leaving a limited buffer against shocks and making early-stage loss mitigation more consequential.
What this means for credit unions
- Prioritize early engagement: Watch for early signs that a member may be struggling, such as higher card utilization or missed payments. These small changes often precede a rise in delinquency, and late‑2025 data showed overall household delinquency beginning to edge higher.
- Strengthen card strategies in a high‑APR environment: Since carrying balances is more expensive, offer options that reduce pressure. This can include thoughtful line management, targeted promotional rates, and fast, supportive hardship outreach when members start to fall behind.
- Take a proactive approach to auto loans: Auto delinquencies have increased across borrower groups, so clear communication and early intervention are key. Offer flexible payment arrangements, right‑sized extensions, and guidance that helps members avoid repossession.
- Improve visibility into BNPL use: Because BNPL payments are not always visible in credit reports, add simple questions about these obligations in member interactions. Help members organize repayment so short‑term installment plans do not create cascading fees.
- Plan for thin savings buffers: Savings levels remain low for many households. Provide easy tools like digital reminders, self‑service payment plan options, and short deferrals that help members stay current and avoid slipping into delinquency.
Turning consumer signals into strategy
The story in the data is consistent. Credit usage is steady, carrying costs remain high, auto and student loans can amplify stress, BNPL reduces visibility, and savings cushions are slim.
These patterns reward earlier outreach, better data signals in workflows, and member‑first solutions that keep delinquencies from compounding. We will cover actionable early engagement tactics and portfolio moves in detail during our upcoming delinquency webinar, so make sure to join for more industry insights.
