SBA Hot Topic Tuesday – 30% of Small Businesses are Borrowing Regularly
March 28, 2023
Delaney Sexton
Contributing Editor
SBA Hot Topic Tuesday – 30% of Small Businesses are Borrowing Regularly
“The much-anticipated recession has yet to make a meaningful appearance, if at all,” says Bill Dunkelberg, the Chief Economist for the NFIB. “Since mid-2021, reported average loan rates have risen from 5% to 8% (low compared to the record 19% in 1980) and the Fed reports that banks are tightening up on their lending standards.”
This is the data about small business credit conditions:
• Almost a third of small businesses are borrowing at least once every three months.
• An average of 5% of regular borrowers said they had a harder time obtaining a loan compared to three months ago.
• 3% of borrowers reported that all their borrowing needs were not met, and 25% reported that all their borrowing needs were satisfied.
• In upcoming months, an average 6% of borrowers expect credit conditions to be more difficult, an improvement from the 8% reading in January.
• About a quarter of regular borrowers reporting higher interest rates in February compared to three months ago.
• In February, the average interest rate paid on short-term loans was 7.9%, the highest reading since March 2008.
• Only 2% of small business owners answered that financing and interest rates were the most important problem for their small business.
• In February, almost half of small businesses (47%) were expecting business conditions to worsen in six months, an increase from January.