27% of small businesses relied on credit cards for operations in 2024

21st January 2025

New research by Intuit Quickbooks has found that 27% of small businesses relied on credit cards for operations in 2024, with 33% charging over 25% of their monthly expenses.

Intuit Quickbooks says that this trend highlights a deeper issue of restricted access to affordable traditional financing, as banks become more selective in lending.

In addition, banks are becoming more selective with their long-term lending to small businesses amid navigating rising interest rates and more stringent monetary policies. This shift leaves SMEs with fewer options, potentially leading to reliance on more expensive debt or postponement of important investments.

The report found that Banks with higher income gap scores provided more access to credit card financing. To combat these challenges, small businesses are advised to develop comprehensive financial plans, embrace digital tools, and seek support from accountants to improve their financial health and access to credit.

The report, developed with Economist Ufuk Akcigit, found that SMEs are struggling to grow, create jobs, and invest in the future. A significant challenge is limited access to financing as this can have a ripple effect on the economy, potentially affecting innovation, employment, and overall recovery.