Equifax Canada: Most Small Businesses Don’t Feel Supported by their Banks or Government
29 Settembre 2021 - 11:00AM
While most financial institutions and governments are quick to tout
their commitment to small businesses, a recent survey from Equifax
Canada conducted in advance of Small Business Month indicates that
despite pandemic support programs, over half feel that they are not
supported by their banks or government. Within a nationwide panel
of 300 small business owners, 52 per cent said this about their
banks and 62 per cent felt this way about government.
Many small and medium businesses have struggled to get through
the pandemic. To survive, they’ve taken out loans and accessed
emergency benefit programs like the Canada Emergency Business
Account (CEBA). Almost half of the survey respondents (46 per cent)
say they have secured a private or government loan. Interestingly,
56 per cent of respondents feel that they have enough credit from
the government to meet their 2021 Q4 needs, and 77 per cent agree
that they have enough credit from their suppliers to get by,
especially those whose businesses have been operating for three
years or more.
“For a small business owner who has struggled during the
pandemic, it’s not just about the money. It’s also about helping
them to better understand their relationship with credit and how
best to pay back these loans,” said Jeff Brown, Small and Medium
Business Leader, Equifax Canada. “Small business owners are
grappling with a lot and banks need to be more than just a conduit
for these emergency funds. Banks have an opportunity to counsel
small business owners on how to pay down their debt as soon as
possible to avoid interest accruals and possible interest rate
increases,” noted Brown.
Brown continued, “some small business owners may be expecting or
hoping for some level of debt forgiveness, and greater attention
would need to be paid by policy makers and financial institutions
alike to ensure that getting through the pandemic remains a
priority.”
Confidence, Challenges and Concerns
Despite their debt burdens, 68 per cent of small business owners
surveyed feel confident that their business will recover in 2022,
and those in the online retail space and whose businesses have been
operating 3-5 years are feeling very confident. Those in the online
retail/e-commerce and construction industries are the most
optimistic about returning to pre-COVID normal in the last quarter
of 2021. Businesses that have been operating for 6+ years are
significantly more likely to state that they are less confident
than businesses that have been operating for less time (27 per cent
versus 12 per cent of those <6 years).
Small business owners who took part in the survey said the cost
of goods is their leading concern, with almost half (47 per cent)
worrying about this, followed by customer demand (42 per cent),
supplier product availability (39 per cent), and staffing (33 per
cent). Those who are not confident in their ability to recover in
2022 are significantly more likely to be concerned about their
ability to repay loans (26 per cent versus 18 per cent of those who
are confident).
“In offering support to a small business owner, we must
recognize that each one is unique and at a different point in their
journey as an entrepreneur,” added Brown. “It’s true that some have
struggled, but others have thrived and adapted successfully to the
changes forced onto them by the pandemic. For many operating in
industries like online retail, travel, and food and beverage, they
will be among the first to say that their industry has permanently
changed because of the pandemic.”
Pandemic Pivots
Survey results demonstrate that small business owners are
resilient and will continue to pivot as necessary during the
pandemic:
- Four-in-ten (39 per cent) created or grew their online business
strategy, with around two-thirds (63 per cent) of these individuals
having offered curbside pick-up, and half (50 per cent) offering
home delivery.
- Those whose businesses made $100k+ revenue last year were
significantly more likely to state that they took on extra
debt/credit during the course of the pandemic.
- Almost half of those who took on extra debt/credit expect to
repay it by the end of 2022.
According to Brown, historically many small businesses have had
limited access to commercial credit. Less than a quarter of the
smallest enterprises requested credit in 2018 to fuel growth,
partly reflecting access to commercial credit products. The share
of small businesses requesting credit tends to lag. For some, lower
approval rates will push them to personal credit. Their credit
needs tend to be much lower and geared to working capital.
Equifax Canada is committed to providing insights to financial
institutions and all levels of government to help small business
owners navigate these difficult times. A priority remains to help
small business owners better understand their relationship with
credit, which the survey shows a good number of entrepreneurs
need:
- Six-in-ten (59 per cent) small business owners are aware that a
business can obtain its own business credit report, with only 30
per cent knowing how/where to obtain one, and 29 per cent not
knowing how/where to obtain one.
- Of the 59 per cent who know of the business credit report, only
40 per cent know what their business’ credit score is, while a
little more than half (55 per cent) admit that they don’t
know.
* Equifax Canada commissioned Leger to conduct an online survey
with 300 Canadian small (255) and medium-sized (45) business
owners/leaders/decision makers within the Food, Construction,
Retail, and Travel Industries. It was completed between August 20
and 29, 2021, using Leger’s online panel.
About EquifaxAt Equifax (NYSE: EFX), we believe
knowledge drives progress. As a global data, analytics, and
technology company, we play an essential role in the global economy
by helping financial institutions, companies, employees, and
government agencies make critical decisions with greater
confidence. Our unique blend of differentiated data, analytics, and
cloud technology drives insights to power decisions to move people
forward. Headquartered in Atlanta and supported by more than 11,000
employees worldwide, Equifax operates or has investments in 25
countries in North America, Central and South America, Europe, and
the Asia Pacific region. For more information,
visit Equifax.ca and follow the company’s news
on LinkedIn and Twitter.
Contact: |
|
Andrew Findlater |
Heather Aggarwal |
SELECT Public Relations |
Equifax Canada Media Relations |
afindlater@selectpr.ca |
MediaRelationsCanada@equifax.com |
(647) 444-1197 |
|
Grafico Azioni Equifax (NYSE:EFX)
Storico
Da Mar 2024 a Apr 2024
Grafico Azioni Equifax (NYSE:EFX)
Storico
Da Apr 2023 a Apr 2024