Texas small business loans are awarded well below the national rate, which coupled with the states lower rates of planned growth, could be cause for concern for business owners. Though lower than the national average (62 percent), a still significant 59 percent of small and medium sized businesses in Texas are planning to hire in the next 6 months, according to the most recent Private Capital Access Index from Pepperdine University and Dun & Bradstreet. This planned growth may be hindered, however, by the inability to successfully obtain a small business loan. Only 27 percent of business owners who applied for a Texas small business loan were awarded one, compared to a 37 percent success rate nationally. This lack of access to capital could spell bad news for these businesses, and it’s no surprise business owners are feeling constricted: 56 percent of businesses surveyed feel their opportunities for growth are restricted, while 48 percent feel their ability to hire is restricted.
This lack of small business loans that could hinder growth, could mean some business owners might find themselves dipping into their personal assets. In Q1 2014, almost one-third of Texas small businesses surveyed had to rely on their personal assets to accommodate their business needs, and they may be forced to continue if they can’t increase their access to capital. Without enough access to capital to fund the growth, small businesses may not be able to realize their growth potential.
Is your business struggling with financing? Visit Access to Capital to learn more about funding options and resources for small businesses.
See more statistics on Texas small businesses in the graphic below: