Canada's Magazine for Financing & Leasing Executives

March 15, 2018

Canadian small business investment up modestly in January

TORONTO--PayNet, the leading provider of small business credit data and analysis, reports that the PayNet Canadian Small Business Lending Index (CSBLI) increased slightly from 110.2 in December 2017 to 110.6 in January 2018. Compared to the same month one year ago, the CSBLI is down 6%.

“The rapid contraction in Canadian small business originations may have reached its low point in December, as originations ticked up slightly in January,” said PayNet President William Phelan. “While short-term delinquencies remained at all-time lows and the economy’s strength persisted, Canadian small businesses continued to show reluctance to engage in new originations activity.”

Year-over-year, sectors experiencing growth included Transportation (25%), Construction (12%), Retail (5%), Manufacturing (3%), Professional Services (3%), and Accommodation & Food (1%). Agriculture remains weak (-4%), although originations ticked up slightly in January (0.2%). At a provincial level, all sectors experienced growth in year-over-year loan originations, with Manitoba (14%), Saskatchewan (10%) and Alberta (9%) showing the most significant increases.

The PayNet Canadian Small Business Delinquency Index (CSBDI), shows that loans 30 days past due remained unchanged at 0.82% in January. Compared to January 2017, delinquency decreased from 1.11%, marking the tenth consecutive year-over-year decrease. Over the last three months, 30+ day delinquencies declined in eight out of the nine sectors PayNet tracks, with the exception of Manufacturing (+10 bps). Over that same period, 30+ day delinquencies declined in every province and region in Canada and 90+ day delinquencies declined in every province and region with the exception of Manitoba (+3 bps).

“In contrast to sluggish originations, Canadian small businesses remain in a very healthy financial position at the beginning of 2018,” added Phelan. “Time will tell whether this marks a new baseline for growth.”

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.



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