C-Suite Wednesday – 25% of Small Businesses Had Their Borrowing Needs Met

August 9, 2023

Delaney Sexton
Contributing Editor

C-Suite Wednesday – 25% of Small Businesses Had Their Borrowing Needs Met

In the last four months, business owners have shown a steady increase in small business optimism according to findings from the NFIB’s July Small Business Economic Trends report. Though optimism has risen throughout the summer months, uncertainty has also been steadily climbing with small businesses unsure of what economic conditions are waiting in the coming months.

This is the data on small business credit conditions and capital outlays:

Credit Conditions

  • Fewer small business owners reported that all their borrowing needs were met in July (25%), and more small business owners said that their businesses’ borrowing needs were not met in July (3%).
  • Almost two-thirds of respondents were uninterested in getting a small business loan.
  • Up two points, 4% of small business owners said that financing was their top business problem.
  • Unchanged from the last three months, 6% of small businesses had a harder time obtaining their most recent loan.
  • In the lowest reading of 2023, only 27% of small businesses reported borrowing at least once every three months.
  • 8% of small business owners expect credit conditions to be harder in the coming three months.
  • The average interest rate paid on short-maturity loans during July was 8.5%, down 0.7% from June.
  • 23% of small businesses paid a higher interest rate on their most recent loan compared to three months ago, the lowest reading seen since December 2022.

Capital Spending

55% of small businesses made capital outlays in the last six months, and of those making expenditures, the most reported outlay was new equipment (38%). After new equipment, 22% of owners acquired vehicles, and 15% improved or expanded their facilities. 11% of small business owners spent money on new fixtures and furniture. In the next few months, 27% of small business owners plan to make a capital outlay, the highest reading since April 2022.

NFIB Small Business Economic Trends July 2023