Insight

Small Business Lending Held Steady in November 2024

January 17, 2025

THE EQUIFAX NOVEMBER SMALL BUSINESS LENDING INDEX (SBLI) showed that nominal small business lending volumes were flat month-over-month and decreased 4.3% year-over-year. The SBLI three-month moving average increased month-over-month by 1.1% and decreased 5.2% year-over-year. 

Meanwhile, the Equifax Small Business Delinquency Index (SBDI) 31-90 Days Past Due decreased 3 bps to 1.78% in November 2024. The 31-90 DPD metric is up 6 basis points from November 2023. The SBDI 91–180 Days Past Due held steady at 0.70% from October to November 2024. The Small Business Default Index declined slightly to 3.40%, down 3 basis points month-over-month. 

According to the latest report, the Equifax SBLI suggests that small business lending activity was flat month-over-month in November while the three-month-moving-average ticked up for the first time since April. Meanwhile, defaults and delinquencies were either flat or falling in November, potentially a positive sign for both lenders and small businesses. The U.S. economy entered 2025 on a high note with solid Q3 growth of 3.1% and a reasonably strong expected growth rate of 2.4% in Q4 to round out 2024. While the current outlook is optimistic, it is possible that there could be fewer rate cuts and tighter lending conditions in 2025 than anticipated a few months ago.

Regional Analysis

Small Business Lending:

In November, 35 states had a year-over-year decrease in 12-month rolling lending volumes. Of the ten largest states, seven showed a decrease from 2023.  Georgia decreased 10.5%, California dropped 7.9% and Texas 5.7%. Illinois and Ohio both showed over 3% growth from last year. Of all states, South Carolina (+12%) and Iowa (+9%) had some of the highest growth numbers over last year. Nevada (-16%), Wyoming (-13%), and Washington (-11%) posted some of the largest decreases from November 2023.

Month-over-month, 31 states showed decreased nominal lending activity in the preceding 12 months, including five of the ten largest states. California (-1.6%) and North Carolina (-0.9%) had the largest decreases of these ten in the 12-month period ended in November 2024 as compared to the 12 month period ended in November 2023.

Small Business Delinquency and Default:

Defaults increased in 50 states annually and in 18 states month-over-month. Georgia improved 3% from last year, while all other states showed increases. Minnesota had the largest increase at +60% from last year. Florida (4.72%), Texas (4.31%), and Louisiana (4.28%) had the highest overall default rates amongst all states. North Dakota (2.01%) and Minnesota (2.27%) had the lowest. Of all states, Virginia increased the most from last month at +5%. Of the ten largest states, four increased default rates over last month. North Carolina increased 2% and Pennsylvania increased 1% while Georgia improved 5% and New York improved 4%.

In 31-90 day delinquency, 22 states had an increase in delinquency month-over-month. Delinquency metrics remain elevated with 32 states increasing their delinquency rates from last year (including 6 of the 10 largest states). Florida (2.9%), Georgia (2.8%), and Alabama (2.5%)  have the highest delinquency rates in November 2024, while South Dakota (0.67%) and North Dakota (0.9%) have the lowest. Montana showed the largest annual increase in delinquency, rising 120 basis points since last November. Of the 10 largest states, New York (15 bps) , California (11 bps), and Texas (11 bps)  had the largest year over year increases. Georgia had the largest decrease in 31-90 days past due rates from November 2023, down 12 bps.

Industry Analysis

Small Business Lending:

●     In November 2024, nominal small business lending fell in 8 of the 17 tracked industries month-over-month, holding steady in Information, Construction, as well as Administrative and Support and Waste Management.

●     12-month rolling lending activity weakened most month-over-month (-3%) in Finance and Insurance.

●     Compared to November 2023, lending rose most in Health Care and Social Assistance (+7%), followed Arts, Entertainment, and Recreation (+2%). Lending fell in Information (-11%); Real Estate and Rental and Leasing (-10%) as well as Manufacturing (-10%).

Small Business Delinquency and Default:

●     In November 2024, the annualized Small Business Default Index rose or held steady month-to-month in 8 of the 17 tracked industries, with some of the largest increases in Information (+5%) and Accommodation and Food Services (+2%).

●     On an annual basis, from November 2023 to November 2024, the Small Business Default Index increased in 16 of the 17 tracked industries, led by Mining, Quarrying, and Oil (+54%). 

●     Other large increases include Accommodation and Food Services (+41%) and Wholesale Trade (+39%).

●     On an annual basis, the 31-90 day SBDI rose in three of six industries from November 2023, rising most in Construction (+12%) and Retail (+9%). Transportation delinquency decreased 5%, the first decrease in over 2 years. The 91-180 day SBDI rose in all tracked industries as compared to last year, led by Health Care (+32%) and Agriculture (+32%).

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.