The Equifax Advisory team breaks down the realities behind today’s “K-shaped” economy—from rising consumer debt and delinquencies to lending risk and shifting borrower behavior. With insights on everything from interest rates and inflation to auto loans and student debt, the team translates complex economic signals into practical guidance for lenders and business leaders.

In this episode:

What is a K-shaped economy?
A K-shaped economy describes a split recovery where higher-income consumers gain financial strength while lower-income groups face increasing financial stress.

Why is consumer debt rising in 2026?
Consumer debt is increasing due to higher living costs, reliance on credit cards, and uneven wage growth across income groups.

How are delinquencies impacting lenders right now?
Delinquencies—especially in auto and credit cards—are rising among subprime borrowers, making early risk detection and portfolio monitoring critical for lenders.

What should lenders watch in today’s economy?
Lenders should monitor credit use, debt-to-income ratios, and early indicators like credit card behavior to anticipate shifts in borrower risk.

How does inflation affect different income groups?
Higher-income households can typically absorb inflation, while lower-income consumers feel the impact more acutely through rising costs and limited financial flexibility.