PayNet said small business owners lack a bullish outlook on business expansion, as the Thomson Reuters/PayNet Small Business Lending Index decreased to 98.5 in March from a revised 105.4 in February. The index, which measures the amount of new commercial loans and leases granted to small businesses, and therefore their investment expansion, has been declining, according to PayNet.

This latest report signals a clear slowing of the U.S. small business economy. Meanwhile, credit risk increased slightly as the Thomson Reuters/PayNet Small Business Delinquency Index (SBDI) rose 1 basis point to 1.30% in March. The SBDI is an indicator of the future health of loan portfolios, PayNet said.

“These latest releases suggest small businesses lack the appetite to take on risks. Businesses across the U.S. are slowing their investment in capital forming projects and at the same time the credit ratings of small companies as a group are falling, although still high by historical standards,” said William Phelan, president of PayNet.