04/18/2025 | Press release | Distributed by Public on 04/18/2025 02:14
THE EQUIFAX FEBRUARY SMALL BUSINESS LENDING INDEX (SBLI) showed that nominal small business lending decreased by 4.3% month-over-month and 10.2% year-over-year. The SBLI three-month moving average is effectively flat - it decreased month-over-month by 0.4% and decreased 0.3% year-over-year.
Meanwhile, the Equifax Small Business Delinquency Index (SBDI) 31-90 Days Past Due decreased slightly to 1.67% in February 2025, down three basis points month-over-month and down two basis points from February 2024. The SBDI 91-180 Days Past Due decreased slightly to 0.68% from January 2025 to February 2025. The Small Business Default Index decreased slightly to 3.35% and was down four basis points month-over-month.
According to the latest report, the Equifax SBLI suggests that small business lending decreased in February (-4.3% M/M, -10.2% Y/Y) as businesses pulled back on spending and investment. The data likely reflects growing caution amid tariff shocks and broader
economic uncertainty, which both surged in the first quarter. Over the last month, the United States announced new tariffs that, if fully implemented, could significantly increase the cost of imported goods. Small business owners who rely on imports will likely
experience higher costs, and tariffs are also expected to have a negative effect on consumer demand and put upward pressure on inflation.
Small Business Lending:
In February, 34 states had a year-over-year decrease in 12-month rolling lending volumes. Of the ten largest states, five showed a decrease from 2024. California and Georgia both decreased 11%, Florida decreased 4%, and Texas dropped 3%. Ohio showed 5% growth from last year while Illinois grew 3%. Of all states, North Dakota (+17%), South Dakota (+13%) and Iowa (+11%) had some of the highest growth numbers from last year. Nevada (-16%) and Wyoming (-12%) posted some of the largest decreases from February 2024.
Month-over-month, nominal lending activity was down in 34 states in the preceding 12 months, including eight of the ten largest states. California had the largest decrease (-1.3%) of these ten in the 12-month period ended in February 2025 as compared to the 12-month period ended in February 2024. Only Michigan (0.2%) and North Carolina (+0.1%) increased lending activity slightly.
Small Business Delinquency and Default:
Defaults increased in 38 states annually and in eight states month-over-month. Year-over-year, Georgia improved nearly 19%, while Maine had the largest default rate increase, jumping 55%. Florida (4.5%), Louisiana (4.4%), and Texas (4.3%) had the highest overall default rates amongst all states. North Dakota (1.8%), Iowa (2.3%) and Nebraska (2.3%) had the lowest. Of the ten largest states, three increased default rates over last month. Illinois increased 4% while Pennsylvania and Texas increased less than 1%. New York and Georgia improved the most of the group of ten, both decreasing 3%.
In 31-90 day delinquency, 32 states had an increase in delinquency month-over-month. Florida (3.0%), Georgia (2.9%) and Connecticut (2.7%) have the highest delinquency rates in February 2025, while South Dakota (0.5%), Ohio (1.1%) and Delaware (1.1%) have the lowest. Maine showed the largest annual increase in delinquency, rising 106 basis points since last February. Of the ten largest states, Michigan (+5 bps), Texas (+5 bps), and New York (+ 5 bps) had the largest year-over-year increases. North Carolina decreased 28 bps from February 2024, Florida decreased 24 bps and Illinois decreased 15 bps.
In February 2025, nominal small business lending fell in seven of the 17 tracked industries month-over-month, holding steady in Retail Trade, Construction, and Real Estate and Rental and Leasing.
12-month rolling lending activity weakened most month-over-month (-4%) in Information.
Compared to February 2024, lending rose most in Arts, Entertainment, and Recreation (+6%), followed by Health Care and Social Assistance (+5%). Lending fell in Information (-10%), Mining, Quarrying, and Oil and Gas Extraction (-9%), Manufacturing (-8%), and Transportation and Warehousing (-8%).
Small Business Delinquency and Default:
In February 2025, the annualized SBDI rose or held steady month-to-month in five of the 17 tracked industries, with the largest increases in Agriculture, Forestry, Fishing and Hunting (3%), and Mining, Quarrying and Oil and Gas Extraction (1%).
On an annual basis, from February 2024 to February 2025, the SBDI increased in 13 of the 17 tracked industries, led by Mining, Quarrying, and Oil and Gas Extraction (+52%).
Other large increases include Agriculture, Forestry, Fishing and Hunting (+27%), and Accommodation and Food Services (24%).
On an annual basis, the 31-90 day SBDI increased 4% in the Construction industry vs. February 2024. All other segments improved, with Transportation dropping 12% and Agriculture decreasing 11% from last year.
Produced monthly, the Small Business Indices help lenders and businesses track changes in the small business marketplace by providing insights into lending, default and delinquency trends. To learn more and view the latest reports, check out our Small Business Indices page.