Small business owners face significant financial hurdles, particularly concerning credit and financing. The 2024 Federal Reserve’s Small Business Credit Survey highlights that 93% of small businesses experienced financial challenges in 2023, with high costs of goods and wages being predominant. Despite more loan applications getting approved compared to pandemic years, nearly half of the businesses did not receive the full financing they required. Furthermore, satisfaction with lenders has dropped, exacerbated by high interest rates and systemic biases, like those faced by startups led by people of color. This article emphasizes the importance of building strong business credit, separating personal from business credit, and offers actionable advice for improving credit literacy and managing cash flow, thereby enhancing a business's ability to secure necessary financing effectively.
Read the full article here.