TORONTO--(BUSINESS WIRE)--PayNet, the leading provider of small business credit data and analysis, reports that the PayNet Canadian Small Business Lending Index (CSBLI) increased to 112.0 in February compared with 110.2 in January 2018. Compared with the same month one year ago, the CSBLI is down 5%.
“While February saw a slight uptick in Canadian small business investment, new origination activity remains slow,” said PayNet President William Phelan. “February marked the seventh consecutive month of year-over-year origination decreases in Canadian small businesses. Additionally, the latest release shows an increase in short-term delinquencies, representing a slight decrease in financial health.”
Year-over-year, sectors experiencing growth included Transportation (23%), Construction (13%), Retail (10%), Manufacturing (3%) and Professional Services (3%). Showing sizable decreases were Accommodation & Food (-5%), Agriculture (-6%) and Wholesale (-6%). At a provincial level, all sectors experienced growth in year-over-year loan originations, with Manitoba (13%), Quebec (11%) and Alberta (9%) showing the most significant increases.
The PayNet Canadian Small Business Delinquency Index (CSBDI) shows that loans 30 days past due or more jumped 8 basis points in February (0.89) compared with January (0.81), representing the largest increase in any given month since April 2016. Compared with February 2017, delinquency decreased from 1.11%, marking the eleventh consecutive year-over-year decrease.
Compared with January, 30-day delinquencies increased across all industries, most notably Accommodation & Food (+32 bps), Wholesale (+25 bps), Transportation (+18 bps), Retail (+9 bps), Professional Services (+7 bps), Construction (+6 bps) and Manufacturing (+6 bps). Material deterioration in financial health is underway in all provinces with some showing large jumps. Month-over-month, Ontario and Manitoba each increased 15 bps to 1.24% and 0.81%, respectively. Only Saskatchewan showed a moderate increase, rising only 2 bps.
“While still low by historical standards, this jump in 30-day delinquencies means Canadian private businesses are experiencing increased financial stress,” added Phelan. “Whether this rising stress is a correction from unusually low levels of delinquency or a material shift in direction remains to be seen.”
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.