Small business owners have credit lines pulled

The National Small Business Association just released its year-end economic report, based on a member survey. One thing jumped out at me: 28 percent of business owners surveyed said they had a line of credit or credit card limit decreased in the last six months.

Also worth noting: half have used credit cards in the past six months, up from 41 percent in August. Half of those using credit cards pay the balance each month, down from 56 percent in August. That means that, according to the survey, roughly one in four small business owners carries a monthly credit card balance.

And apparently, many small business owners don’t know whether they’re using personal cards or business cards. Business credit cards are usually personally guaranteed anyway, but the difference is important because the two are now regulated differently. According to the report:

There exists significant confusion among small-business owners about their credit cards and whether or not they are using a personal card for business purposes or whether their card is classified as a business card. According to the December survey, 41 percent rely on a combination of business and personal credit cards. When asked in a recent quick-poll, 54 percent were unaware of the differences between personal and business credit cards. Furthermore, 37 percent have reported an increase in solicitations for business credit cards—making more broad reform of the entire credit card industry paramount.

Check out the full report here.

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