In 2026, the global lending and finance ecosystem stands as a testament to resilience amid global market uncertainty. Across continents, institutions have navigated a maze of policy shifts, tariff pressures, and evolving consumer behaviors to maintain stability while embracing innovation.

This article explores key trends, projections, and practical strategies for stakeholders seeking to thrive in this dynamic environment.

Global Credit Losses and Projections

Credit losses remain top of mind for banks and investors alike, yet forecasts suggest a manageable trajectory. Analysts predict a manageable credit losses despite tariffs scenario, with total global losses rising 7.5% to $655 billion in 2026 following $609 billion in 2025.

The pace is expected to moderate in 2027, growing by 4.3% to $683 billion. The Asia-Pacific region drives much of this expansion, as banks there absorb the impact of cross-border tariff disputes and shifting trade flows.

Leveraged finance performance also shows signs of stabilization. European institutional loans may see defaults ease to 3.0%–3.5%, while high-yield bonds could settle in the 3.75%–4.25% range.

Banking Sector Outlook

Credit ratings agencies maintain stable outlooks for the banking sector. S&P Global reports that 85% of bank ratings were unchanged as of late 2025, reflecting robust capital ratios and diverse funding sources.

Moody’s highlights robust liquidity buffers and capital as critical buffers against volatility. Despite a modest net interest margin squeeze, banks offset pressure through fee-based services and strong deposit growth.

Regional dynamics vary significantly:

Structured Finance and Alternative Lending

The structured finance market continues to benefit from lower interest rates, as consumer ABS, RMBS, and CLO issuance remains strong. Commercial real estate delinquencies remain elevated, but refinancing activity has alleviated some pressure.

Private credit emerges as a formidable competitor to traditional banks. Fundraising has surged, with the global private credit market potentially expanding from $1 trillion to as much as $3.7 trillion by 2030.

• Consumer ABS and corporate CLOs supported by stable underwriting standards.
• Geopolitical and trade uncertainties temper supply in Europe and Asia.
• Alternative lenders leverage AI and data analytics to streamline origination.

Securities Lending and Payments Markets

Record revenues in global securities lending highlight a vibrant segment. In 2025, revenue reached $15.3 billion, a 26% year-on-year jump that underscores increased institutional demand for short positioning and collateral management.

Meanwhile, the broader payments market expanded from $13.3 trillion in 2025 to an estimated $14.3 trillion in 2026. Technological innovation, including digital wallets and real-time settlement, fuels transaction volume and drives fee income.

Regional Lending Trends and Consumer Perspectives

In the United States, consumer credit patterns show stabilization after a mid-year slowdown. Credit card balances, which fell by 2.8% in H1 2025, have plateaued, while commercial and industrial loan growth rebounds from a 5.6% dip.

Europe benefits from consolidation within its banking sector, though mild performance headwinds persist due to tariff spillovers. In the Asia-Pacific, emerging markets sustain robust loan growth even as tariff risks linger.

Technology adoption plays a vital role in consumer resilience. Surveys show that 61% of borrowers believe digital tools make it easier to navigate financial challenges, highlighting the value of intuitive mobile apps, AI-driven budgeting tools, and automated alerts.

Funding, Liquidity, and Risk Management

Deposit growth remains a core pillar of funding stability. U.S. banks saw deposits rise by 5% year over year, while European and Asia-Pacific institutions report moderate gains. Contingent liquidity facilities and market access remain strong, although some banks face constrained cash buffers.

Key risks include geopolitical tensions, policy volatility, and the potential for slower GDP growth. Yet tailwinds from easing central bank rates and continued technology investment bolster market confidence.

Emerging Disruptors and Strategic Recommendations

Nonbank lenders and private credit funds exert increasing pressure on traditional deposit bases. To stay competitive, banks must:

• Enhance digital platforms to streamline origination and servicing.
• Leverage data analytics and AI to refine credit underwriting.
• Diversify fee-based revenue sources to offset NIM headwinds.

Regulatory landscapes are also evolving. U.S. agencies consider adjustments to capital requirements, while Basel standards see phased reductions in gold-plating. Institutions should actively engage with policymakers to shape outcomes that balance safety with growth.

As we navigate 2026, stakeholders across banking, structured finance, and payments can draw strength from strong capital positions, resilient business models, and a willingness to embrace innovation. By focusing on digital transformation, disciplined risk management, and strategic collaboration, the financial ecosystem can continue to thrive in the face of shifting global dynamics.