Small Business Lending Decreased in March 2026

The Equifax March Small Business Lending Index (SBLI) showed that nominal small business lending volumes decreased 5.5% month-over-month (but decreased 4.3% year-over-year). The SBLI three-month moving average decreased 4.4% month-over-month but decreased 7.1% year-over-year.

Meanwhile, the Equifax Small Business Delinquency Index (SBDI) 31-90 Days Past Due was 1.67% in March, up two basis points month-over-month and down two basis points from March 2025. The SBDI 91-180 days past due remained level at 0.71% from February 2026 to March 2026 and was up two basis points year-over-year. The Small Business Default Index (SBDFI) measured 3.31% and was down one basis point month-over-month.

In March, the Small Business Lending Index decreased 5.5% month-over-month and is down 4.3% over the last year. Delinquency rates continue to remain stable: short-term delinquencies (31-90 days) have moved only two basis points lower in five months, while longer-term delinquencies (91-180 days) have remained flat for nine months.

The U.S. economy started 2026 on a positive note, expanding 2.0% in the first quarter. Business investment and consumer spending have been the primary drivers, though growth has not been evenly distributed. The AI buildout is the backbone of business investment growth while small business lending and optimism have softened. Meanwhile, April Consumer Price Index (CPI) inflation rose to nearly 4% as energy costs skyrocketed-combined with two consecutive months of solid job growth, the Federal Reserve System is unlikely to cut rates in the near term.

Regional Analysis

Small Business Lending:

In March, only 19 states had a year-over-year increase in 12-month rolling lending volumes. Of the 10 largest* states, four showed an increase from 2025. Georgia had the strongest improvement at +5%. California decreased the most at -9%. Of all states, Delaware (+16%) and Kansas (+7%) had the highest growth numbers compared to the same period last year. North Dakota (-17%) and New Mexico (-13%) posted the largest decreases from March 2025 of all states.

Month-over-month, nominal lending activity was down in 33 states in the preceding 12 months, including seven of the 10 largest states. Most of the remaining states where lending increased showed increases of less than 1%: the biggest increase was Georgia with +0.5%. Of all states, North Dakota (-3% month-over-month) and New Mexico (-3% month-over-month) decreased the most. Of 50 measured states, only 10 had month-over-month increases over 1%, led by Delaware (+11%).

Small Business Delinquency and Default:

Defaults decreased in 33 states year-over-year and decreased in 29 states month-over-month. Year-over-year, Maine improved the most, declining by 33%, while North Dakota had the largest default rate increase, jumping 29.7%. Texas (4.7%), Florida (4.6%) and Georgia (4.3%) had the highest overall default rates among all states. Pennsylvania (2.1%), Wisconsin (2.1%), and Massachusetts (2.1%) had the lowest. Of the 10 largest states, only California and Texas increased default rates in March 2026, rising 0.7% and 2.6% month-over-month, respectively. The remaining states decreased default rates month-over-month, led by Pennsylvania which dropped by 4.7%.

In 31-90 day delinquency, 19 states had an increase in delinquency month-over-month. Georgia (2.9%), Florida (2.9%), and Mississippi (2.8%) had the highest delinquency rates in March 2026, while South Dakota (0.9%), Ohio (0.9%), and Iowa (1.0%) had the lowest. Delaware showed the largest year-over-year increase in delinquency, rising 81 basis points since last March. Of the 10 largest states, Michigan (+40 basis points) and Georgia (+30 basis points) had the largest year-over-year increases. New York decreased 20 basis points from March 2025, and Pennsylvania dropped 18 basis points.

Industry Analysis

Small Business Lending:

• In March 2026, nominal small business lending fell in six of the 17 tracked industries month-over-month, holding steady in eight industries including Information, Educational Services, and Retail Trade.

• 12-month rolling lending activity weakened most month-over-month (-4%) in Mining, Quarrying, and Oil and Gas Extraction.

• Compared to March 2025, lending rose the most in Finance and Insurance (+4%), followed by Administrative and Support and Waste Management (+3%), and Real Estate and Rental and Leasing (+2%). Lending fell in Information (-13%), followed by Agriculture, Forestry, Fishing and Hunting (-9%), Accommodation and Food Services (-8%), and Mining, Quarrying, and Oil and Gas Extraction (-7%).

Small Business Delinquency and Default:

• In March 2026, the annualized SBDFI rose or held steady month-over-month in nine of the 17 tracked industries, with the largest increase in Educational Services (+7%).

• From March 2025 to March 2026, the SBDFI increased in eight of the 17 tracked industries, led by Educational Services (+26%), Mining, Quarrying, and Oil and Gas Extraction (+16%), and Agriculture, Forestry, Fishing and Hunting (+13%).

• From March 2025 to March 2026, the 31-90 day SBDI increased 11% in the Agriculture industry, 6% in Retail, and 1% in Construction. All other segments improved, with Transportation dropping 8% and General and Health Care both decreasing 2%.

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.

*By population