Small Business Checkpoint: Striking a balance on credit

Although small business credit card balances are rising, elevated deposit levels provide support.

Headshot of Taylor Bowley

Taylor Bowley

Headshot of David Tinsley

David Tinsley

February 2024

Key takeaways

  • With small business demand for credit softening, rising outstanding loan balances might reflect some of the pressures small businesses are under from tighter credit and higher interest rates. Additionally, Bank of America internal data suggests small businesses are relying more on their credit cards.
  • Positively, however, we find that 'inflation-adjusted' balances remain below pre-pandemic levels, even for small businesses with annual revenue greater than $1 million, whose 2023 average balance increased by approximately 13% compared to the 2019 average.
  • Plus, elevated deposit levels appear to be supporting small businesses across revenue tiers. Furthermore, total payments growth per small business client rose year-over-year (YoY) in January, particularly in services sectors, a sign that small businesses remain well-positioned.

Read our full analysis for a more in-depth look at these trends.

Small Business Checkpoint is a regular publication from Bank of America Institute. It aims to provide a real-time assessment of small business spending activities and financial well-being, leveraging the depth and breadth of Bank of America’s proprietary data. Such data is not intended to be reflective or indicative of, and should not be relied upon as, the results of operations, financial condition or performance of Bank of America.