Report on Employer Firms: Findings from the 2025 Small Business Credit Survey (Federal Reserve Banks (Small Business Credit Survey))

Summary

• Increased costs of goods, services, and/or wages was the most common financial challenge, affecting 73% of firms.p.9
• At the time of the survey, 46% of small employer businesses reported using artificial intelligence for work.p.32
• Among credit applicants, 42% received the full amount of financing sought, while 22% received no funding.p.20
• Outstanding debt was absent for 31% of employer firms at the time of the survey.p.14

Key insights

1. Eighty-four percent (84%) of firms sourcing foreign inputs reported year-over-year price increases in 2025.p.11
2. Reaching customers and growing sales was the primary operational challenge, cited by 57% of small employer firms.p.9
3. Personal guarantees were utilized by 59% of debt-holding firms to secure their outstanding debt.p.15
4. The share of financing applicants seeking funds from online fintech lenders grew from 17% in the 2020 survey to 29% in the 2025 survey.p.5
5. Writing or marketing was the leading task for AI usage among adopting firms, cited by 83% of AI users.p.33
6. Among nonapplicants for financing, 63% declined to apply because they already had sufficient funding.p.17