Indicator Status vs. 10-Year Averages
Each indicator compared to its 10-year mean. Green means the reading is within normal range. Yellow means it has drifted materially. Red means it is far outside historical norms.
Side-by-Side Comparison
| Indicator | Current | Prior Period | Year Ago | Change |
|---|---|---|---|---|
| Business Loan Delinquency Rate | 1.34% | 1.33% | 1.27% | 0.01pp ↑ |
| Business Loan Charge-Off Rate | 0.55% | 0.57% | 0.51% | 0.02pp ↓ |
| Lending Standards (Small Firms) | 8.90% | 8.30% | 11.10% | 0.60pp ↑ |
| C&I Loans Outstanding ($B) | $2,741.7B | $2,708.7B | $2,664.3B | $33.0B ↑ |
| Federal Funds Rate | 3.64% | 3.64% | 4.33% | 0.00pp → |
| Business Debt-to-GDP Ratio | $8.72T | $8.66T | $8.53T | $0.07T ↑ |
Source: Federal Reserve FRED. All data as of latest available period.
Reading the Dashboard: What These Six Numbers Tell You
Here is the executive summary of small business debt conditions as of Q4 2025: borrowers are under modest but increasing stress, banks are beginning to absorb real losses, credit is still flowing, and the cost of money remains elevated. None of these readings, taken alone, would cause alarm. Together, they describe a credit environment that is tightening at the margins.
The Delinquency Signal
Business loan delinquencies stand at 1.34%, up from 1.27% a year ago. That is 0.15 percentage points above the 10-year average of 1.19%. This is not a crisis reading — the GFC peak was 6.75%. But the direction matters more than the level. Delinquencies have risen in three of the last four quarters, and the trajectory has not reversed. When delinquencies grind higher for multiple consecutive quarters, it means borrower cash flows are eroding in a way that is not transient.
The Charge-Off Confirmation
Charge-offs at 0.55% are elevated relative to the 10-year average of 0.37%. Banks are writing off more loans than they have at any point since the energy-sector stress of 2016. Charge-offs are a lagging indicator — they confirm losses that delinquencies signaled quarters earlier. The fact that both are elevated simultaneously means we are past the early-warning stage and into the realized-loss stage.
Credit Is Still Open, But the Terms Are Getting Worse
Lending standards for small firms read 8.90% on the SLOOS survey, meaning a net 8.9% of banks are tightening. This is well below the pandemic spike of 70% and the GFC peak of 74.5%, but it is positive territory — banks are tightening, not easing. That distinction matters. During expansions, this number turns negative (banks actively compete for loan business). A persistently positive reading means the credit window is narrowing.
Volume and Cost
C&I loans outstanding stand at $2,741.7B, growing modestly. Businesses are still borrowing, which means the credit market has not frozen. But they are borrowing at a federal funds rate of 3.64%, which is 1.39 percentage points above the 10-year average of 2.25%. Every dollar borrowed costs more to service. The total stock of business debt relative to GDP sits at an all-time high of $8.72T — meaning the aggregate system has never been more leveraged.
The Bottom Line
This dashboard is not flashing red. It is flashing yellow. The pattern is one of gradual deterioration: rising delinquencies, rising charge-offs, modest tightening, elevated rates, and record leverage. The risk is not a sudden shock but a slow squeeze on cash flows. If you carry variable-rate business debt, this is the quarter to lock in a fixed rate, extend your credit facility while your bank is still willing, and build a cash cushion. The data says the environment is getting harder, not easier.
Why This Dashboard Matters
If you run a business with debt, this dashboard is your executive summary of the credit environment. When delinquencies and charge-offs are rising, banks are tightening, and the fed funds rate is elevated, it means the credit window is closing. That is the time to refinance existing debt, build cash reserves, and avoid taking on new leverage. When the indicators are all moving in the other direction, it is an opportune time to invest and borrow.
Small Business Debt Dashboard — FAQ
Six key Federal Reserve indicators: business loan delinquency rate, charge-off rate, bank lending standards for small firms, total C&I loans outstanding, the federal funds rate, and the business debt-to-GDP ratio. Together they show the full small business debt picture.
Bank lending standards (SLOOS survey, DRTSCIS) are the most forward-looking because they reflect what banks plan to do next. Delinquencies and charge-offs are current/lagging indicators. The fed funds rate is set by policy and determines borrowing costs.
The warning pattern is: lending standards tighten first, then delinquencies rise, then charge-offs spike. If the fed funds rate is also elevated and debt-to-GDP is near highs, the conditions for a credit contraction are in place.
Delinquencies, charge-offs, and lending standards are quarterly. The fed funds rate and C&I loans are monthly. Debt-to-GDP is quarterly. The dashboard updates as each new data point is released.
Check it quarterly. If three or more indicators are deteriorating, take defensive action: build cash reserves, lock in fixed rates on variable debt, negotiate credit line renewals before they expire, and delay discretionary capital expenditures.