A new study recently released by Experian noted that despite upticks in many economic indicators, small businesses are still facing an especially tightened credit market and a major decline in overall lending.  The annual benchmark report showed that financial institutions have maintained their hesitant attitude toward small business lending, with overall loan volume to the sector dropping 10% over the past year.

Small businesses have continued to rigorously seek out credit and have increasingly begun relying on credit cards, with credit card volume increasing by 22% over the same period.  As small businesses have migrated to credit cards for their cash flow needs, applications to financial institutions for financing have also dropped over the last year.   

Source:  NACM; courtesy Jacob Barron, NACM staff writer

BIIA Newsletter January 2010 Issue