That's because beyond the psychological threshold of the 10% interest level being breached, the expectation is that the Fed will keep rates elevated for an extended period of time. "The pain is already in, and there will be more," Arora said. A majority (62%) of owners told NFIB they are not interested in applying for a loan. Almost a quarter of small business owners said they are paying a higher rate on their most recent loan, and the highest since 2008. ![]() A few people over the past few weeks have said to me, 'Wow, it will be double digits.'" More entrepreneurs cite financing as top problemĪ monthly NFIB survey of business owners released earlier this week found that the percentage of entrepreneurs who reported financing as their top business problem reached its highest reading since December 2018 - the last time the Fed was raising rates. "Psychology matters as much as facts and it could be a tipping point. Many business owners have never seen double-digits," said Rohit Arora, co-founder and CEO of small business lending platform Biz2Credit. "Every 50 basis points costs more and there's no denying it, psychologically, it is a big deal. "Business owners will be very careful taking out new debt next year," he added. "I think it's started already," Hurn said. But there will be an added psychological effect among potential new applicants. Servicing debt at a time of input inflation and labor inflation is forcing business owners to make much tougher decisions and sacrifice margin. The monthly interest payment owners will be making isn't very different from what's already become one of the primary costs of Fed rate hikes on Main Street. Many business owners have never seen double-digits percentage Personal Loans for 670 Credit Score or Lower Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit
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