Personal Funds Prop Up Some Small Businesses

One-third of small business owners have used their own savings or credit cards to keep their enterprises afloat. 

July 31, 2020

NEW YORK—About 35% of small-business owners have used their own personal savings or credit cards to stay afloat, a new survey from found, CNBC reports. Other sources for financial help included business credit cards or savings accounts, or loans, such as the Paycheck Protection Program (PPP). Seventy percent of survey respondents indicated they have used one of those sources to keep their doors open since March when the coronavirus pandemic started.

“These are tough numbers,” said Ted Rossman, industry analyst for “They show just how dire this is for small businesses, and also how intertwined their personal and business finances are. You kind of have to worry about some of them compromising their own financial well-being.”

For business credit cards, owners might be personally held liable for paying the balance. “It’s a bit of a misconception because these cards might give you better rewards on business stuff like office supplies or online advertising but in the end, they require a personal guarantee,” Rossman said. “So usually the owner ends up being on the hook personally.”

Corporate credit cards allow the company itself to be the debt guarantee, but companies must have at least $1 million in revenue to qualify for those cards. “The longer this stretches on, the more help that will be needed,” Rossman said. “If there’s not substantial government stimulus, we’ll see a lot more businesses and consumers falling behind.”

This week, congressional Republicans, Democrats and the White House have begun negotiations for what will be included in the next stimulus package. NACS has been leading a broad coalition of essential industry associations asking for liability relief. These groups sent a letter to Congress asking that liability legislation (the SAFE TO WORK Act) be included in that package.

Coronavirus Resources

NACS has compiled resources to help the convenience retail community navigate the COVID-19 crisis. For news updates and guidance, visit our coronavirus resources page.