US small-business borrowing down in January: PayNet

Category: Small Business Borrowing
Published: Saturday, 07 March 2015
Written by Admin

n>(Reuters) - US small businesses pared borrowing in January after a record prior month, according to data released on Tuesday.

The Thomson Reuters/PayNet Small Business Lending Index fell to 120.9 from an upwardly revised December reading of 133.5, the highest since the indexs launch in January 2005.

From a year earlier, the index was up 3 percent, suggesting the US economy is still on track with continued expansion, PayNet founder Bill Phelan said.

Extreme cold muted business investment, he said, and businesses at the beginning of the year were also still digesting the large investments they made in the previous year.

The index has historically tracked US gross domestic product growth two to five months ahead.

Loan delinquencies ticked up to 1.54 percent, separate PayNet data showed, a sign that, despite the overall increase in borrowing in 2014, businesses are for the most part repaying what they owe.

PayNet collects real-time loan information such as originations and delinquencies from more than 250 leading US lenders.

(Reporting by Ann Saphir. Editing by Andre Grenon)



US small-business borrowing up in December -PayNet

Category: Small Business Borrowing
Published: Wednesday, 04 February 2015
Written by Admin

n>Feb 3 (Reuters) - US small businesses took out more loans in December, according to data released on Tuesday, with companies in consumer-dependent industries like transportation, food and accommodation driving the increase.

The Thomson Reuters/PayNet Small Business Lending Index rose to 129.8, the third-highest level on record, and compares to an upwardly revised November reading of 117.6. The index was set at 100 at its January 2005 launch, and peaked two years later at 131.7 before plummeting to about half that level around the time of the Great Recession. The index set a new record of 132 in October 2014, the revised figures show.

Its a domestic consumer story, PayNet founder Bill Phelan said, noting that a decline in oil prices helped fuel the renewed borrowing.

Companies in the transportation business increased borrowing by 27 percent in December, he said, and borrowing by companies in food and accommodation rose 13 percent. That compares with overall year-on-year borrowing growth of 10 percent.

Meanwhile, small companies in oil patch areas like North Dakota pulled back on borrowing.

Loan delinquencies ticked down to 1.54 percent, separate PayNet data showed, a sign that despite an overall increase in borrowing in 2014, businesses are for the most part repaying what they owe.

PayNet collects real-time loan information such as originations and delinquencies from more than 250 leading US lenders. (Reporting by Ann Saphir; Editing by Chizu Nomiyama)



Small Business Borrowing Eases in November, Survey Says

Category: Small Business Borrowing
Published: Thursday, 15 January 2015
Written by Admin

Small businesses slowed their borrowing in November following two months of strong growth, Thomson Reuters and PayNet said Tuesday. The two companies Small Business Lending Index dropped 11 percent to 116 from Octobers 129.7. The October reading was revised downward from 131.8. The index is compiled from PayNets database; the company compiles credit ratings on small businesses.

No surprise

The dip in borrowing levels was not unexpected after the lending index rose 2 percent in October and 7 percent in September, PayNet President William Phelan said. The November reading was up 1 percent from a year earlier, so the long-term upward trend of borrowing is intact.

The slower pace likely reflects companies overall conservative attitude toward borrowing. Many held off taking on debt following the recession, waiting for their sales and the economy to show clear signs of strength. Their increased borrowing during 2014 dovetailed with a gradual increase in hiring. More companies took out loans so they could expand, and that growth included taking on new employees.

Look ahead

This week brings several readings on whether small businesses were confident enough to increase their hiring at the end of the year. Software maker Intuit, payroll company ADP and the advocacy group National Federation of Independent Business release their reports on small business employment. And the Labor Department issues its December report. Although it wont break down hiring by company size, it will give an indication of what small businesses did last month.

--Associated Press



Credit Union Membership Grows by a Record-High 100000 During Three ...

Category: Small Business Borrowing
Published: Friday, 09 January 2015
Written by Admin

LANSING, Mich., Jan. 6, 2015 /PRNewswire/ --Michigan credit unions reported record setting growth through the third quarter with a combined 97,175 new members, bringing the total number of Michigan credit union members to over 4.73 million.

Consumer and small business borrowing also rose by record-high rates in almost all categories from new/used auto loans to credit cards while small business loans grew by over 17 percent from the same time last year.

Consumers and small businesses in Michigan continue to discover the great service and tremendous value at credit unions in record numbers, Michigan Credit Union League amp; Affiliates CEO Dave Adams said, We havent seen growth numbers like these in decades.

According to financial analysts at the Credit Union National Association (CUNA), the states 2.5 percent 12-month growth in memberships is the fastest annual increase recorded since 1998. The growth is particularly noteworthy because the states population has remained stagnant over the last few years.

When it comes to lending, Michigan credit unions saw the largest increases in member business loans with a 17.3 percent year-over-year increase.

In the past ten years, and even through the financial crisis in 2008, credit unions have continued to lend to small businesses. Business loans have soared from $192.7 million in 2004 to $587 million in 2009 to $1.4 billion at the end of the third quarter of 2014.

The steady increase in new members could correlate with the steep rise in new and used auto loans, which are up 12.3 percent and 14.8 percent from the same time last year, respectively. The popular GM Credit Union Member Discount could account for a segment of the solid auto lending increases. The program helped General Motors grow its national market share when more than 160,000 credit union members used the discount to buy a new car or truck in 2014. CU Solutions Group, a subsidiary of the Michigan Credit Union League, manages this national program, encouraging thousands of credit unions across the country to promote GM product discounts to their 100 million members.

Heres how Michigans lending performance breaks down.

  • Quarterly increase in new auto loans: 5.6 percent
  • Year-over-year increase in new auto loans: 12.3 percent
  • Year-over-year increase in used auto loans: 14.8 percent
  • Year-over-year increase in first time mortgages: 7.5 percent
  • Year-over-year increase in unsecured loans: 11.1 percent
  • Year-over-year increase in member business loans: 17.3 percent

CUNA analysts say an upturn in the national economy seen through strong personal consumption, federal government spending, softer energy prices and a decline in the Michigan jobless rate by 1.5 percentage points are all helping to fuel the credit union loan growth nationally. In Michigan, likewise, as the economy improves and households gain confidence, more and more credit union members are making home improvements, refinancing loans to lower rates and buying big ticket items such as cars, appliances and furniture, often financed by the very low loan rates offered at credit unions.

About the Michigan Credit Union League amp; Affiliates
Organized in 1934, the Michigan Credit Union League is a trade association representing Michigans Credit Unions. Based in Lansing, the MCUL works to build awareness of these locally owned, cooperative institutions and their mission to support members, communities and local businesses. For more information, visit www.mcul.org, follow us on Facebook at www.facebook.com/MICreditUnions and connect with us on Twitter at www.twitter.com/MICreditUnions.

SOURCE Michigan Credit Union League amp; Affiliates



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