Appeared on June 5, 2009
Donna DeCarolis, Ph.D., associate dean of strategic initiatives at Drexel University’s LeBow College of Business, said credit cards have been the most popular option for small businesses. But two-thirds of small business owners have reported major rate increases and 41 percent said their credit lines were reduced in the past year, according to a recent study from the National Small Business Association. A Federal Reserve study shows that 41 percent of banks tightened credit in the past year and 70 percent raised interest on credit loans. “These [small businesses] are angry,” DeCarolis said. “They are good customers who pay their minimum balance. But the other side of things is that Advanta needs to stay afloat.”