Commercial Pulse Report | 7/1/2025
This week the Experian Commercial Pulse report focuses in on a fascinating paradox in the e-commerce industry that credit and risk management professionals should closely monitor. While online retail revenues continue their upward trajectory—now representing over 16% of total U.S. retail sales and generating quarterly revenues exceeding $300 billion—commercial credit inquiries from e-commerce businesses have declined by nearly 25% in the past year alone.
This counterintuitive trend reveals important insights about business maturation, cash flow management, and evolving credit risk profiles in the digital commerce space. Watch our Commercial Pulse update to hear the details.
Market Consolidation in Action
The e-commerce landscape is undergoing significant consolidation. Despite the U.S. hosting nearly 14 million of the world’s 30+ million e-commerce websites, the total number of e-commerce businesses declined by 13.1% between 2024 and 2025. This contraction, following explosive growth during the pandemic years, suggests the sector is moving beyond its initial growth phase into a more mature, efficiency-focused stage.
For credit professionals, this consolidation presents both opportunities and challenges. Fewer new entrants mean reduced origination volumes, but surviving businesses may represent stronger, more creditworthy prospects.
The Credit Demand Decline: Key Metrics
The data reveals several critical trends in e-commerce credit behavior:
Credit Inquiry Patterns:
- 2023 to 2024: 24.9% decrease in commercial credit inquiries
- Average credit accounts per business: Just over 2 accounts
- Average new credit amount: $32,000 (below pre-pandemic levels of $37,000)
Historical Context:
The current average credit amount represents a significant decline from the 2020 peak of $41,000, when federal COVID relief programs supplemented traditional lending. This normalization suggests businesses are operating with more realistic capital requirements and improved cash management.
Strong Credit Performance Indicators
Despite reduced credit demand, e-commerce businesses are demonstrating exceptional credit management:
Delinquency Improvements:
- 60-day past-due rates: Decreased by 50% over four years (from 0.46% to 0.23%)
- 90-day delinquency rates: Following similar downward trend
- Commercial credit scores: Now above pre-pandemic levels
Utilization Efficiency:
- Current utilization rate: 39% (down from 43.5% in 2020)
- Trend indicates improved cash flow management and conservative credit usage
Strategic Implications for Credit Professionals
1. Portfolio Quality Enhancement
The improving delinquency rates and lower utilization suggest that e-commerce businesses requesting credit today may represent higher-quality prospects than in previous years. This sector’s financial discipline could make it an attractive target for lenders seeking low-risk commercial accounts.
2. Origination Strategy Adjustment
With credit inquiries down significantly, lenders may need to be more proactive in their e-commerce outreach. The reduced inquiry volume doesn’t necessarily indicate reduced creditworthiness—it may simply reflect better cash management by these businesses.
3. Risk Modeling Considerations
The sector’s improved risk profile suggests that traditional risk models may need recalibration. E-commerce businesses that weathered the post-pandemic consolidation may deserve more favorable risk assessments than historical data might suggest.
4. Competitive Positioning
As fewer lenders may be focusing on this sector due to reduced demand, there could be opportunities for institutions willing to develop specialized e-commerce credit products and expertise.
Market Outlook and Uncertainties
While the e-commerce sector shows strong fundamentals, broader economic uncertainties remain, including:
- Potential tariff impacts on international supply chains
- Federal Reserve interest rate policy decisions
- Global energy market volatility
These factors could influence future credit demand and risk profiles across all sectors, including e-commerce.
The key takeaway: declining credit demand in e-commerce doesn’t signal sector weakness—it indicates strength. Businesses that have survived the consolidation phase while maintaining strong cash flows and excellent credit performance may represent some of the most attractive commercial credit prospects in today’s market.
Stay Ahead with Experian
- ✔ Visit our Commercial Insights Hub for in-depth reports and expert analysis.
- ✔ Subscribe to our YouTube channel for regular updates on small business trends.
- ✔ Connect with your Experian account team to explore how data-driven insights can help your business grow.
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As temperatures rise across the U.S., so does the nation’s appetite for travel—and the Leisure & Hospitality sector is feeling the heat. In this week's Commercial Pulse Report, we examine how soaring consumer demand intersects with evolving credit conditions for businesses in travel, lodging, and transportation. Travel Rebounds, But the Story Is Mixed By every measure, Americans are traveling in droves. AAA projected over 72 million domestic travelers over the July 4th holiday—setting a record. Meanwhile, Memorial Day travel surged across all transportation types, especially road trips, which saw a 3.0% year-over-year increase. However, despite six new TSA checkpoint records in June, major airlines have cut forward-looking forecasts, signaling a notable shift: travelers are increasingly opting for alternatives like road and rail over the skies. This change in travel behavior has direct implications for how different business subsectors access and manage credit. Infrastructure Drives Commercial Credit Trends The Leisure & Hospitality industry is broad and fragmented—from mega-airlines and hotel chains to small sightseeing operators and independent RV campgrounds. This diversity is reflected in commercial credit data. Businesses with heavy infrastructure needs—like airlines and hotels—tend to carry higher loan and credit line balances. Airlines, in particular, average the highest number of commercial trades, a reflection of their large-scale operations and capital intensity. Hotels also hold sizeable credit, but with a twist. While revenues have rebounded beyond pre-pandemic levels, occupancy rates remain flat due to an increase in room supply from new construction. The hotel pipeline stood at 6,211 projects with over 722,000 rooms as of Q3 2024, signaling sustained investment even amid margin pressures. Rental Cars: High Volume, Higher Risk The rental car sector stands out—but not in a good way. Despite being a key enabler of domestic travel, these businesses exhibit the highest commercial credit risk across the industry. According to Experian’s Commercial Risk Classification, 32% of rental car companies are considered Medium-High to High Risk, compared to less than 10% in categories like air transport and sightseeing. The elevated risk may be due to a combination of factors: fleet acquisition costs, multi-location exposure, and operational disruptions during the pandemic. While credit trades in this segment remain high, inquiries have declined over recent years, possibly reflecting tightening lending standards or constrained demand for new credit. Encouraging Risk Trends—With Exceptions Across the broader Leisure & Hospitality industry, there’s been a decline in commercial credit risk since 2020. The share of businesses classified as Medium-High or High Risk dropped from 11.7% to 8.5% as of April 2025. Most firms now fall into the Medium Risk category—a sign of normalization in the sector. Delinquency rates remain low (under 1%), and the average Intelliscore Plus v2 score has remained stable across most subsectors. Still, credit conditions vary sharply by business type, underlining the importance of nuanced risk assessment in portfolio management. Smarter Credit Allocation Starts with Subsector-Level Insight The summer travel surge is a powerful reminder of the sector’s resilience—but not all players are experiencing the boom equally. For credit professionals and commercial lenders, the latest data from Experian suggests a growing divide: infrastructure-heavy firms are leaning into credit, while high-risk subsectors like rental cars may warrant closer scrutiny. Whether your clients are in air transport or roadside accommodations, understanding these credit trends will be key to navigating the second half of 2025. ✔ Visit our Commercial Insights Hub for in-depth reports and expert analysis. ✔ Subscribe to our YouTube channel for regular updates on small business trends. ✔ Connect with your Experian account team to explore how data-driven insights can help your business grow. Download the Commercial Pulse Report Visit Commercial Insights Hub Related Posts
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