SBA Hot Topic Tuesday – Over 80% of Small Businesses will Seek Financing This Year
May 9, 2023
Delaney Sexton
Contributing Editor
SBA Hot Topic Tuesday – Over 80% of Small Businesses will Seek Financing This Year
“Even with continued external pressures, small business owners are bullish about their business prospects in the coming year,” says Sharon Miller, President of Small Business, Head of Specialty Banking and Lending at Bank of America. “While business confidence is increasing, confidence in the national economy remains low, with just 34% of business owners expecting the national economy to improve over the next 12 months. Concerns about economic factors, including commodities prices and interest rates, are top of mind for business owners.”
Here are the facts from Bank of America’s 2023 Small Business Owner Report:
- 82% of business owners plan to obtain funding to support their business in the next year, a 12% increase from a year ago.
- 54% plan to use business credit cards.
- 29% plan to use traditional bank loans.
- 13% will use other government loans.
- According to Bank of America, small business owners are divided on their opinions of how rising interest rates will affect their decision to seek financing.
- 30% of small business owners said interest rates are making them more likely to seek financing.
- 37% said interest rates are not impacting their decision to seek financing.
- 33% said interest rates are making them less likely to seek financing.
- Two-thirds of small business owners cited interest rates as an economic concern, up 10 percentage points from Spring 2022.
- 41% of business owners reported that they were worried about the availability of credit, up 9% from a year ago.
- Although there are economic concerns, almost half of small business owners (48%) plan to expand their business in the next year, up 11 percentage points since last spring.