Small Business Defaults in Michigan on the Rise in December
DETROIT, February 28, 2018 (Newswire.com) - PayNet, the leading provider of small business credit data and analysis for the commercial and industrial lending industry, reports that in December 2017 a greater number of Michigan's small businesses defaulted on existing loans. Of the 18 major industries, six rose in the state compared to the previous month.
PayNet’s Small Business Default Index (SBDFI) for Michigan registered at 1.63% after a 3 basis point rise from November. Compared to the national SBDFI level of 1.83%, Michigan's SBDFI was 20 basis points lower. The uptick in defaults over the past three months may signal weakening financial health in the state. Year-over-year, Michigan's SBDFI increased 30 basis points, while the national SBDFI has remained consistent.
Accommodation and Food Services (3.12%); Transportation and Warehousing (2.76%); and Agriculture, Forestry, Fishing and Hunting (2.24%) exhibited the worst default rates of all industries in Michigan. Nationally, Accommodation and Food Services had a default rate of 2.25%, with a difference of +0.38% compared to the prior year, while Michigan had a variance of +1.25%.
The PayNet Small Business Lending Index (SBLI) for Michigan registered at 112.1, exceeding the national SBLI level (100.3) and performing similarly to the previous month's state level. Small business borrowers are considering increasing investment.
"The recent increase in risk-taking and defaults results from greater investment," asserts the president of PayNet, William Phelan.