California Small Business Defaults Increasing in April
Chicago, IL, June 14, 2017 (Newswire.com) - In April 2017, small business loan defaults worsened in California, according to data announced by PayNet. Of the 18 major industries, 12 worsened and 6 improved in the state.
In spite of a 5 basis point climb from March, California's PayNet Small Business Default Index (SBDFI) of 1.67% was still 23 basis points below the national SBDFI level of 1.90%. Rising default rates over the past year signals heightened financial stress in the state. The national SBDFI increased 26 basis points year-over-year, while California's SBDFI increased 24 basis points.
The three industries with the worst default rate in California were Mining, Quarrying, and Oil and Gas Extraction (4.58%); Transportation and Warehousing (4.44%); and Information (2.78%). With a 3.36% variance, Mining, Quarrying, and Oil and Gas Extraction has also seen the largest increase year-over-year of any industry in California.
The PayNet Small Business Lending Index (SBLI) for California registered at 96.8, declining 0.7% from last month's level and 1.4% beneath the national SBLI level this month (98.2). Small business borrowers are being cautious and holding off on new investment.
"The increasing default rate over the past year has created a cautious lending environment," explains the president of PayNet, William Phelan.
For more information on PayNet, visit www.paynet.com.
Source: PayNet, Inc.
