Mixed News on Consumer Credit Conditions
Recent data from the American Bankers Association (ABA) and Cox Automotive’s Dealertrack Credit Availability Index suggest that consumer credit conditions remain largely resilient, even as lenders continue to exercise caution in the face of multiple challenges.
The ABA’s Consumer Credit Index rose to 42.5, its second consecutive quarterly increase. Nonetheless, the index, drawn from input from economists at the largest banks in North America, remained well below its “breakeven level” of 50, indicating that expectations for overall consumer credit conditions over the next six months remain soft. One bright spot: expectations for credit availability increased to 50 for the third quarter.
The August 2026 Dealertrack Credit Availability Index painted a more favorable picture. Credit access increased for a fourth consecutive month, with the index reaching 105.3, its highest level since 2015. Approval rates climbed to 73.9 percent, subprime lending edged higher, and lenders continued to rely on longer loan terms to support vehicle affordability. However, rising borrowing costs remained a challenge, as average contract rates approached 11 percent.
Taken together, these reports suggest that consumer credit markets are stable, if less than robust. Encouragingly, the steady expansion of auto credit availability and improving indicators of consumer lending broadly, point to continued support for consumer spending and economic growth through the remainder of 2026.
Stay tuned for the release later this month of AFSA’s Consumer Credit Conditions Index (C3 Index) for the third quarter of 2026, which provides the take on both current and expected conditions from senior consumer finance company executives from across the consumer credit spectrum.
October 1st, 2026
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