Credit Card Companies Squeeze Small Business Owners

The fear of small business owners defaulting on their lines of credit has credit card companies pinching consumers to pay off their debt or face declining credit lines.  Small business owners that became used to using their American Express® lines of credit have been blind sided by slashed credit lines resulting in declined charges that they rely on to run their business.  Business owners are finding out at the point of purchase that the card limit has been reduced by getting the decline notification. 

This is a no win situation for most.  Business owners rely on floating their cash over a month by using their credit lines, but with credit companies making this impossible for them, some businesses may actually fail because they can’t float their monthly expenses. Therefore leading to the default of their credit card payments. In some cases the credit card companies are shooting themselves in the foot.

Credit card companies are cutting lines on card holders with credit scores of 700 or below.  They are also looking at criteria like the card holder’s home value and even what bank they hold their mortgage with.

Even business consumers that have a long history and have never missed or been late with a payment are not safe from the credit line hatchet.  The cuts are happening on a monthly basis as credit card companies are diligently checking their card holder’s credit reports for any significant changes.