At the same time, many small businesses also described how their credit limits were being reduced. After being denied credit, many tapped their personal and business credit cards, particularly for working capital or as a line of credit. Businesses described, and several banks confirmed, that in some cases banks are recommending the use of credit cards in response to requests for smaller loans.
Others attributed the increased use of credit cards to the relative ease of applying for and using a credit card as compared to the time and effort required to secure a bank loan. –      7  Some businesses reported incurring additional costs in relying on credit cards.