PayNet Sees Canadian Small Businesses Settle into Steady Growth
TORONTO--(BUSINESS WIRE)--Sep 18, 2018--PayNet, the leading provider of small business credit data and analysis, reports that the PayNet Canadian Small Business Lending Index (CSBLI) edged down 1.7% from 127.9 in June to 125.7 in July, its first decline following six straight increases on a monthly basis. However, the index is up 6.2% on the year, its third consecutive year-over-year gain and the index’s strongest annual growth since September 2015.
“While not completely into expansion mode, Canadian businesses are moving in the right direction,” said PayNet President William Phelan. “Canadian small business growth is not accelerating like it is in the U.S., but we see it achieving a plateau after climbing out of over a year of contraction. Steady investment by small businesses bodes well for further growth in the Canadian economy as a whole.”
Compared with July 2017, the majority of industries experienced positive growth in lending, with four posting double-digit gains: Transportation (+26.6% Y/Y), Accommodation & Food (+25.8% Y/Y), Manufacturing (+17.7% Y/Y), and Retail (+12.3% Y/Y). Regionally, Alberta (+13.5% Y/Y) and Atlantic Canada (+13.1% Y/Y) led growth on a year-over-year basis, while lending in Quebec (+10.3% Y/Y) and Ontario (+5.5% Y/Y) climbed to all-time highs.
The PayNet Canadian Small Business Delinquency Index (CSBDI) 31-180% increased one basis point from 0.95% in June 2018 to 0.96% in July 2018. However, delinquencies fell one basis point on the year, marking the 16 th consecutive decline on an annual basis following year-over-year increases in each of the prior 25 months. Compared to year-ago levels, delinquencies decreased in five industries, including Construction (-38bp Y/Y) which saw its 12 th straight year-over-year decline. However, Manufacturing delinquencies rose 83 basis points on the year, its sharpest increase since April 2016, and delinquencies in Professional Services (+15bp Y/Y) increased on an annual basis for the first time in 17 months. On a year-over-year basis, delinquencies decreased in the majority of regions, led by Quebec (-25bp Y/Y), which fell to an all-time low.
“Canadian small businesses have shown consistent investment growth, and the addition of one more solid month will help drive economic expansion,” added Phelan. “While credit risk remains moderate, it is quietly creeping up and bears watching. For now, steady investment will position businesses for continued expansion, though lenders should expect a rise in credit losses as investment picks up.”
About PayNet, Inc. Canada
PayNet, Inc. Canada is the premier provider of risk management tools and market insight to the commercial credit industry, collecting real-time loan information from leading Canadian lenders and turning it into actionable intelligence. The company’s proprietary database — updated weekly — is a growing collection of commercial loans and leases, worth over $92 billion. Using state-of-the-art analytics, PayNet converts raw data into real-time market intelligence and predictive information that subscribing lenders use to manage risk, lower operating costs, originate more loans and improve their business strategy. For more information visit paynet.ca and sbinsights.ca.
View source version on businesswire.com:https://www.businesswire.com/news/home/20180918005906/en/
CONTACT: For PayNet, Inc. Canada
KEYWORD: NORTH AMERICA CANADA
INDUSTRY KEYWORD: SMALL BUSINESS PROFESSIONAL SERVICES BANKING FINANCE
SOURCE: PayNet, Inc. Canada
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PUB: 09/18/2018 12:51 PM/DISC: 09/18/2018 12:51 PM