March 15, 2018 / 9:14 AM / 9 months ago

Canadian small business lending inches up in January: PayNet

OTTAWA (Reuters) - Lending to small Canadian businesses was little changed in January as stronger activity in the accommodation and food industry was offset by weakness in support services for the resource sector, data showed on Thursday.

The PayNet Small Business Lending index rose to 110.6 in January from a downwardly revised 110.2 in December. But medium-sized companies fared worse, with the measure of lending falling to 184.6 from 192.3.

Compared to a year earlier, lending to small companies was down 6 percent, moderating from December’s 8 percent annual drop and suggesting the recent declines in lending may be leveling off, said PayNet President Bill Phelan.

“We hopefully have found the bottom here for contraction from these smaller private businesses,” Phelan said.

Lending to accommodation and food companies rose to 221.4 from 218.4. Lending also rose in other sectors including manufacturing and wholesale trade.

But activity fell in the “other” category to 175.3 from 176.4. The sector includes companies that provide services to mining and drilling companies.

The financial health of small companies continued to look strong with the 30-day delinquency rate holding at 0.82 percent. Companies that were 90 days or more behind on their loans remained at 0.25 percent.

Reporting by Leah Schnurr; Editing by James Dalgleish

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