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Small business kicks into high gear in Q4 as index sets new record

February 18, 2015 by Gary Stockton

Experian / Moody's Analytics Small Business Credit Index

Experian’s Business Information Services has released the Q4 2014 Experian / Moody’s Analytics Small Business Credit Index.
Turning the page from recovery to growth, small businesses continue to have access to a wider availability of credit, as credit conditions reached the highest level on record, improving for the third consecutive quarter. Outstanding credit balances grew by 2.2 percent from a year ago, while delinquency rates declined to a cyclical low of 8.5 percent, both of which contributed to the improvement in the index.

“Small businesses are finally kicking into high gear,” said Mark Zandi, chief economist for Moody’s Analytics. “They are investing and hiring more, and are borrowing more to finance their expansion. They are also repaying what they have already borrowed in a more timely way. Business conditions are much improved, and will likely improve even more in coming quarters.”

Findings from the report also showed that small businesses have helped themselves, improving their risk and payment behavior across the board. Most notably, over the last year, small businesses have reduced the number of days they paid their bills beyond contacted terms by full a day, or more than 19 percent. Over the same time period, the average commercial risk score for a small business rose 3.1 percent to reach 61.6, while bankruptcy rates dropped significantly, with 10.9 percent fewer businesses filing.
For more insights, download the latest report today.

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To learn more about small business trends, visit our Small Business Insights page.

Hiq Lee, President, Business Information Services

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