FICO Reports Bankers Pessimistic About Small Business; Survey Respondents Mostly Consumer Bankers

I am not sure if I looking too much into it, but it appears to me that the respondents to the FICO survey were probably a self-selecting group of consumer bankers, not small business bankers that would be expected to have a¬†knowledgeable view on small business credit¬†. It is not entirely unexpected as FICO is focused on consumer credit and would likely draw the best response from consumer bankers. FICO even calls its report “US Consumer Credit Risk.”

In page 11 of the report, FICO gives a profile of respondents to the survey. The areas of responsibility for bankers comprised cards, mortgages, auto loans, direct deposit accounts, lines of credit and student loans. I did not see any category for small business. It could be that lines of credit is not home equity lines (as I think it is), but business lines of credit (unlikely). In any case, the survey is definitely useful for its outlook on consumer credit, but I would not look too much into expectations for small business.

FICO’s survey revealed a pessimistic outlook for small business. Of the risk professionals responding to the survey, 74% expected the demand for credit from small business to increase, but only 46% expected credit supply to increase. With regard to credit approval rates, 60% responded that they expected the statistic to remain the same or decrease.

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