Consumer Lending

The 2,794 consumer lending companies in the US, also known as “payday lenders”, provide unsecured short-term loans to consumers experiencing cash flow shortfalls. About 3% of all adult Americans have used a payday loan. Companies may also provide student loans and loans secured by real estate or automobiles. Some firms also provide other personal financial services, such as check cashing, money orders, and wire transfers.

Negative Public Perception

With annual interest rates of almost 400% and a customer base consisting primarily of low-income borrowers, many consumer advocates view payday loans as predatory lending that takes advantage of the working poor.

Sep 22, 2026 - Housing Squeeze Reshapes Consumer Borrowing

• High mortgage rates and stubborn home prices are doing more than freezing up the housing market - they are changing how Americans borrow. Would-be buyers who remain renters longer may have less room in their budgets for auto loans, personal loans, and other credit, while existing homeowners have a strong incentive to stay put rather than trade a low-rate mortgage for a much costlier one. For consumer lenders, home equity is becoming a more important piece of the picture. Federal Reserve Bank of New York data show home equity lines of credit balances reached $459 billion in the second quarter of 2026, up $142 billion from their 2022 low. Credit card balances also climbed to $1.26 trillion. With moving and refinancing less attractive, homeowners may be more inclined to tap existing equity to finance renovations and other major expenses rather than take on a new mortgage.
• A growing divide in household finances is creating a "K-shaped" consumer economy that isn't apparent in the headline economic data. According to HB Wealth, higher-income households continue to benefit from rising home values, stock prices, and strong balance sheets, while lower-income borrowers are relying more heavily on credit cards and other debt to cover everyday expenses. Delinquencies on credit cards, auto loans, and other consumer debt are rising fastest among lower-income households even as overall lending metrics remain relatively healthy, masking growing financial stress beneath the surface. HB Wealth argues this split helps explain why consumer spending has remained resilient despite mounting signs of strain. Affluent households driving much of the economy while financially stretched consumers become increasingly vulnerable to higher borrowing costs and a slowing labor market.
• US household debt hit a record $18.8 trillion in the first quarter of 2026, according to the Federal Reserve Bank of New York, driven largely by rising mortgage and auto loan balances. Mortgage debt climbed to $13.2 trillion, while auto debt reached $1.69 trillion. The New York Fed reported that credit card debt fell by $25 billion in the quarter to $1.25 trillion, though balances remain $70 billion higher than a year ago. Student loan debt edged down to $1.66 trillion, but more than 10% of balances are now delinquent, nearing pre-pandemic levels. Researchers described overall consumer credit as “stable” but warned of financial strain among younger and lower-income households. The debt surge coincides with rising inflation, as the Bureau of Labor Statistics said consumer prices increased 3.8% in April from a year earlier, the highest inflation rate in three years.
• US mortgage debt is at record highs, according to Bankrate, driven by surging home prices and elevated interest rates. The average American mortgage borrower owes $258,214 - up 3.1% from 2024 - while total household debt hit $18.8 trillion in Q4 2025. Mortgages dominate that figure, dwarfing auto loans ($1.67T), student loans ($1.66T), and credit card debt ($1.28T). Millennials carry the heaviest load at $320,027 on average, and 67 cities now see average mortgage balances exceeding $1 million. The Mortgage Bankers Association puts the delinquency rate at 4.26% in Q4 2025, up year-over-year, with Southern states hit hardest. Per the National Association of Realtors, the median home price has climbed from $280,700 in March 2020 to $398,000 as of February 2026, reflecting what's fueling the ongoing debt surge.

Industry size & Structure

The average consumer lending company has about 30 employees and has annual revenue of about $18 million.

• The consumer lending industry in the US consists of about 2,795 firms with 88,200 employees, generating about $50.4 billion in annual revenue.
• Borrowers in the 30 states where storefront payday lending is permitted took out over 20 million loans totaling nearly $8.6 billion in 2022, and paid about $2.4 billion in fees
• More than half consumers obtain payday loans exclusively through storefront locations, while online lending share has grown to 35-45% per the Consumer Financial Protection Bureau.
• The industry is highly concentrated, with the 50 largest firms representing 80% of industry revenue.
• Many large companies also operate pawn shops.
• They may also operate check cashing and other personal financial services in states where regulations make payday lending unattractive.
• Major companies include Ace Cash Express, Advance America, Cash America, Check N Go, Money Mart and QC Holdings.