Key Insights on Small Business Loan Performance and Emerging Risks
Evaluate whether FY 2023 and FY 2024 loan originations are inherently riskier than those from previous years.
Assess if SBA program changes implemented on August 1, 2024, have increased credit risk for loans under $500,000.
Determine if 2024 saw a surge in defaults due to the delayed effects of pandemic stimulus, particularly for loans originated in FY 2018 and FY 2019.
Investigate if specific lender types (e.g., nonbanks) contributed to riskier loans in FY 2023 and FY 2024, and if their increased SBA participation is linked to higher default rates.
Quantify how the rising Prime rate has affected default rates due to increased debt service payments for small businesses.
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