Banks Expanded Credit Access to Low-Score Borrowers
Large banks increased new credit card accounts for sub-660 score borrowers in the second quarter of 2026.
Updated on Oct. 13, 2026 in Credit Cards
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Large banks in the United States expanded credit card access to borrowers with scores below 660, with these accounts making up 18.5% of new issuances in Q2 2026. This represents an increase from 16.1% during the same period in 2025.
Why it matters
Lenders are actively pursuing growth following years of restrictive underwriting after observing a steady decline in delinquency and net charge-off rates. This shift enables broader market access while banks use conservative credit line sizes to manage risk.
Total new card accounts rose nearly 4% in Q2 2026, while the average new credit line dropped to $6,066. Median lines for borrowers below 660 increased to $600.
The players
Federal Reserve Bank of Philadelphia
This regional branch of the central bank system provides detailed economic research and analysis on consumer credit trends.
PYMNTS Intelligence
This firm provides analytics and research regarding payments and consumer financial trends.
The details
Banks are employing sophisticated underwriting technologies that evaluate risk factors beyond traditional scoring categories. This approach allowed for an 8% increase in approvals among underserved segments, even as banks limited total exposure by keeping individual line sizes modest.
Timeline
Q2 2025 served as the base period for year-over-year share calculations.
May 2026 saw the publication of a PYMNTS Intelligence subprime consumer report.
October 6, 2026, marked a report on Personify Financial approval data.
October 7, 2026, was the release date for the Philadelphia Fed Q2 2026 Insights Report.
Market Dynamics
This transition toward looser underwriting standards follows years of post-pandemic caution among major financial institutions. It signals a move to re-engage with higher-risk consumer segments as bank portfolios show improved performance.
Consumers with lower credit scores may find it easier to qualify for new credit lines as institutions increase their risk tolerance. However, these new accounts often come with more conservative initial credit limits compared to historical averages.
The takeaway
Banks are successfully using new data tools to offer credit to more Americans while maintaining disciplined risk controls. Borrowers should prioritize managing their balances, as 37% of accounts are currently being paid in full each month.
Further reading
Learn more about the evolving landscape of Credit Cards.
Source note: This article includes information reported by PYMNTS.
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