2023 RSM US Middle Market Business Index Special Report: Funding
As financing costs surge, the real economy faces a reckoning: An RSM US MMBI special report
As the era of easy money and low-cost financing ends, middle market businesses are facing a reckoning.
Rising real interest rates are pushing up the cost of commercial and industrial loans, making it harder for these firms to meet payrolls and finance their expansion, according to findings in the third-quarter RSM US Middle Market Business Index survey. The result is a risk to economic growth across the real economy and, potentially, a recession.
The MMBI survey aggregated the responses of 416 senior executives across a range of middle market companies, and was conducted by The Harris Poll for RSM from July 5 to July 25, 2023.
A few of the report’s key findings:
82%
of respondents said that rising interest rates would have a minor to a critical impact on their operations.
15.5%
Middle market firms are now paying anywhere from 10.9% to 15.5% for financing, pushing risk premiums sharply higher.
36%
More than one-third of companies surveyed (36%) have turned to the shadow banking market for financing.
Inside the report
The report provides insights into the rising financial stress of midsize businesses and examines the impact by industry.