The Consumer Bankers Association (CBA) and Small Business Financial Exchange (SBFE) have released findings from a report examining 2022 third-quarter small business lending trends.
Officials noted the Q3 2022 Small Business Lending Trends analysis determined metrics for the period are returning closer to pre-pandemic levels, with external factors showing consistent rate increases continuing to impact lending behavior for the sector.
According to the report, the Small Business Lending Trends base is data reported to the SBFE and includes information on small businesses and their payment performance on commercial credit accounts contributed by SBFE member organizations. SBFE’s membership includes banks, credit unions, alternative lenders, captive finance companies, independent finance companies, and leasing companies, among other entities.
The CBA and SBFE revealed key report findings showed delinquency increased for all account types, representing a reversal from a downward trend experienced over the prior six quarters; credit utilization continues to increase on a quarterly basis and is currently at its highest point in the post-pandemic environment; and charge-offs remained stable when compared to the previous quarter.
The report noted amid policymakers continuing to raise interest rates to address inflation, the impact of the decisions on the nation’s small businesses is increasingly evident. External pressures, combined with uncertain economic conditions ahead, have influenced the type of credit small businesses are seeking to obtain and payment behavior on active accounts.