According to the Thomson Reuters/PayNet Small Business Lending Index, borrowing by U.S. small businesses fell to 110.5 in February from 116.5 in January – the lowest it’s been since September 2013. Considering that the index was at an almost seven-year high in December, the unseasonably cold weather experienced at the end of 2013 and in the first part of 2014 is the most likely culprit. In fact, experts predict that business growth in the first quarter of 2014 will plummet below 2 percent – down from 2.6 percent in the fourth quarter of 2013.
But things are looking up since employment growth, production, and retail sales are beginning to pick up with the warm weather emerging. Another PayNet index reported loan delinquencies in February as holding steady with 1.49 percent of all loans made being delinquent. The record high for this index was 4.73 percent in August 2009, and the record low was 1.44 percent last October.
Mutikani, Lucia and Hay, Andrew. “U.S. small business borrowing slows in February”.reuters.com. 4/1/2014.