New technology is upending everything in finance, from saving to trading to making payments.

This article is more than 2 years old.

February 18, 2015 This article is more than 2 years old.

The Federal Reserve of New York is worried about America’s student loans.

Its latest snapshot on borrowing shows that even though Americans have been working on shoring up their finances over the past few years, more people are falling behind on their student loans. The rate of delinquency and its impact on the US economy has reached a “concerning” level, according to Fed economists.

Until 2009, student loans in the US made up the smallest proportion of Americans’ household debt. That changed when Americans paid down their home and car loans during the recession but continued to borrow for school, even as tuition costs continued to rise. Just five years later, the $1.2 trillion in Americans’ outstanding student debt is higher than all other types of non-mortgage debt (mortgage debt, at $8.2 trillion, remains 69% of Americans’ total borrowing).

For some perspective, the amount Americans owe in student loans has surpassed the GDPs of Australia, New Zealand, and Ireland combined.

Meanwhile, borrowers are struggling to keep up with their student loan payments. The percentage of student loans that are delinquent is rising faster than delinquencies on mortgages, auto loans, and credit cards.

There are repercussions for the broader economy. As more income goes toward school loans, less is going into the housing market. Plummeting home-ownership rates, diminished wealth levels, fewer construction jobs, and lower investment put a damper on economic growth.

Defaulting on student loan payments can also impact a person’s credit score, which makes borrowing for important purchases like homes and cars more difficult down the road.

As students borrow more for school, their debt follows them for longer; outstanding student debt lingers with Americans into their 40s, 50s, and 60s.