First Internet Bank today released its Do More Business™ Report, a research study designed to better understand the economic outlook of small businesses and the consumers who support them. The report is based on insights from a survey of 200 small business owners and a nationally representative survey of 1,000 U.S. consumers.
Small businesses maintain stability in a constrained economic environment by actively managing rising costs through pricing adjustments and margin trade-offs. Consumers remain supportive but increasingly selective in their spending.
Small Businesses Show Resilience
Over three-quarters (76%) of small business owners report being well-positioned to absorb financial shocks such as rising costs, slower demand or delayed payments over the next 12 months. Cost pressures, however, remain the defining challenge. Forty-six percent of small business owners cite inflation and rising expenses as their top concern, outpacing worries about customer demand, cash flow volatility and regulatory change.
In response, businesses are actively managing those pressures. Approximately half have raised prices, while nearly a quarter (23%) absorb higher costs to maintain customer relationships and competitiveness.
This approach reflects measured confidence. Most businesses plan steady or moderate growth rather than aggressive expansion as they balance opportunity with ongoing economic uncertainty.
Opportunity to Deepen Banking Partnerships
Most small business owners (76%) report satisfaction with their bank’s digital experience. Core capabilities such as mobile banking, real-time payments and fraud monitoring broadly meet expectations, indicating that foundational digital tools are largely in place for many businesses.
The greater opportunity lies in strategic guidance and financial education. As businesses navigate cost pressures and evolving demand, they make increasingly disciplined financial decisions and look for support beyond transactional banking. Greater clarity around available financing options and more proactive guidance can help businesses make more informed decisions and confidently pursue opportunities in a more uncertain environment.
Consumers Remain Supportive, but Selective
Consumer support for small businesses remains strong. Nearly all consumers (96%) say supporting local businesses matters to them personally. Most (83%) have shopped at a small business in the past month, and 37% shop at least weekly, with 68% indicating a willingness to pay a premium to do so.
Even when small businesses raise prices due to factors outside their control, 78% of consumers say they are understanding. But at the same time, nearly one in five consumers report abandoning a purchase when their preferred payment method is not available, underscoring the importance of flexibility and convenience as spending decisions become more deliberate.
“The confidence we’re seeing from small businesses is encouraging, and it reflects real opportunity ahead,” said Nicole Lorch, President and Chief Operating Officer of First Internet Bank. “At the same time, businesses must navigate a more complex environment, forced to balance cost pressures, customer expectations and growth decisions. Owners have told us they want faster access to capital, clearer guidance on financing options and digital tools that reflect how they actually run their businesses. That’s the foundation for the kind of banking partnership that helps businesses succeed in today’s environment.”