Credit card delinquency rates among borrowers under 35 reached 8.2 percent in Q1 according to new Federal Reserve data.
This is the highest level since 2009 for that age group.
High interest rates and cost of living pressures are the main contributors.
Banks are tightening lending standards in response to the rise.
The economy is finally breaking through the last financial buffer for younger Americans.
For the first quarter release:
- The Headline Credit Index remained unchanged in Q1 2026 at 37.5, after improving 1.1 points in the previous quarter. Credit conditions are still expected to weaken over the next six months, with an improvement in business credit conditions offset by a reduced outlook for consumer credit.
- The Consumer Credit Index fell 1.7 points to 33.3 in the first quarter, marking the second consecutive quarterly decline. Overall expectations for both consumer credit quality and credit availability were negative in the first quarter. Bankers express a mixed and cautious outlook for consumer lending.
- The Business Credit Index rose 1.7 points to 41.7 in the first quarter, following an 8.7 point jump in the previous quarter. While the below-50 reading still signals expected deterioration, the outlook for both business credit quality and availability became less negative over the quarter.
Average credit card APR hits 22.5% and stays near record highs