- 24% of SMBs’ report carrying a credit balance month to month
- Half of all SMBs report carrying credit debt occasionally
- Only 33% of consumers carry occasional credit debt
- 1 in 4 SMBs have a loan with a non-bank alternative lender
- 2018 saw reported cash flow disruption double from 5% to 10% of SMBs
For businesses, and especially small businesses, business credit cards are considered a financing tool despite the relatively high cost compared to say a bank loan or a bank line of credit. These costs are somewhat offset by rewards – and three quarters of SMBs report that rewards are accrued to the business rather than to the owner or individual. Still, quick access to credit seems to be the driving interest for busienss credit cards even in the face of less costly alternatives. This focus on speed is mirrored in Mercator’s findings for the appetite for alternative lending products in SMBs, who are motivated above all by speed and easy application processes.
Data for this episode of Truth In Data provided by Mercator Advisory Group’s report – Business Credit Cards and B2B Payments: Opportunity to Improve Market Penetration
About this report
In spring 2018, Mercator Advisory Group fielded its third annual web-based survey of U.S. small businesses (between $500,000 and $10 million annual sales) regarding payment acceptance, business-to-business, or B2B,-payments and use of banking services and alternative lenders. Business Credit Cards and B2B Payments: Opportunity to Improve Market Penetration is the second of three reports summarizing the results of the 2018 Small Business Payments and Banking Survey.