New York Fed Releases Inaugural Puerto Rico Small Business Survey
SAN JUAN – The Federal Reserve Bank of New York has released findings from its Puerto Rico Small Business Survey, which focuses on the business performance, financing needs and borrowing experiences of firms across the island. This inaugural survey was designed by the New York Fed with input from partners in Puerto Rico, and is modeled after the U.S. mainland Small Business Credit Survey.
According to the New York Fed, the survey is a step in its efforts to “understand and inform policymakers and service providers about U.S. small business credit” and is “designed to fill important knowledge gaps about the Island’s small business financing conditions and flag potential economic growth opportunities for the Commonwealth.”
The agency said Monday that a majority of firms reported declining revenues and that a third did not receive the credit they were seeking. The survey also stated that 80 percent of businesses do not sell online or export.
According to the New York Fed, key survey findings include that firms are persevering through Puerto Rico’s economic crisis, though a majority reported declining revenues. Managing cash flow is a top concern, ranked above concerns about rising business costs.
There is significant demand for credit, with about half of all small firms needing less that $25,000 and the most common reason being the need to meet operating expenses. One-third of credit applicants didn’t receive any of the credit that they applied for.
“About 80% of firms do not sell online or export their wares or services. Firms see this as a growth opportunity, ranking programs in support of growing sales—to the federal government, via online commerce and through exports—as their top training need,” reads one of the release’s bullet points.
“By extending our small business coverage to include Puerto Rico, we are now broadening our understanding of the credit environment for all U.S. small firms. We also hope that the survey results will help advance the dialogue now underway on solutions to revitalize Puerto Rico,” Kausar Hamdani, senior adviser and senior vice president in the Communications and Outreach Group at the New York Fed, said in a Monday release.
Agency President William Dudley is scheduled to travel to the island this month.