My first piece of information on this topic came from the inventory item "Weapon parts" that you got from dismantling weapons.
Weapon parts - used to upgrade and repair weapons.
There is also the same descriptions for the three armour dismantled parts.
My second clue was that after a while, I noticed that my cloak (on my Warlock) had become tattered and soiled. I had sworn it was nice and crisp a few hours beforehand.
So my question is, does your equipment actually degrade? I haven't seen anything similar to durability, so is it only aesthetic?