Subprime Auto Performance Explained

Welcome back to the Fintech Takes podcast. I’m Alex Johnson, joined by Dave Wasik (Partner at 2nd Order Solutions) for our new series, Facing Credit, where we unpack what’s happening in lending right now.

First, we kick off with the big picture in December 2025, starting with delinquency rates. TL;DR: Things don’t appear to be improving, and if you squint, they may be eroding.

Next, credit cards and BNPL. Dave explains why cards hold up, thanks to their clear value prop, rewards stickiness, and issuer concentration (the top 10 issuers control 82% of cards). Minimum payments are flexible and low, helping riders through cash-flow crunches. On the other hand, BNPL has shifted from big ticket items to everyday spending like groceries and restaurants (we discuss why the shift raises concerns, especially with limited bureau reporting).

Finally, auto, student loans, and the thing at the top of Dave’s worry board: private credit. It’s enormous, growing rapidly, and hard to manage (there’s no data to either corroborate or refute the risks; leverage plus interconnected bets can turn a small shock into a cascade).

Plus, we’ll close each Facing Credit episode with our guest’s take on one trend shaping the industry. This time: what does the breakdown of FICO as the standard mean for credit scoring and underwriting?

Tune in for Dave’s take!

This episode was brought to you by Marqeta. Don’t sacrifice agility for stability. With Marqeta, launch payments experiences that perform at scale and flex with your business. Learn more at https://marqeta.com/ftt

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