Minnesota Small Business Defaults Down in September, as is Borrowing

Saint Paul, MN, November 21, 2017 (Newswire.com) - ​Data published by PayNet indicate that a smaller number of small businesses defaulted on loans in Minnesota and the level of borrowing activity worsened in September 2017.

PayNet’s Small Business Default Index (SBDFI) for Minnesota was lowest in the nation at only 1.05% after a 3 basis point reduction from August. Compared to the national SBDFI level of 1.86%, Minnesota's SBDFI was 81 basis points lower. The decline in defaults over the past three months may signal better business conditions in the state. Year-over-year, the national SBDFI rose 7 basis points, whereas Minnesota's SBDFI dipped 20 basis points.

Transportation and Warehousing (3.28%); Accommodation and Food Services (1.91%); and Finance and Insurance (1.69%) displayed the highest default rates of all industries in Minnesota. Nationally, Transportation and Warehousing had a default rate of 4.43%, with a difference of +0.35% compared to the prior year, while Minnesota had a variance of +0.08%.

The PayNet Small Business Lending Index (SBLI) for Minnesota was 80.3, declining 1.5% from the previous month's level and 19.0% below this month's national SBLI level (99.1). Small business borrowers are being cautious and holding off on new investment.

"Falling defaults over recent months signal improved financial health," explains William Phelan, president of PayNet.  

Source: www.paynet.com