Trump tariffs drive US small businesses to risky cash‑advance financing

A new round of tariffs introduced by President Donald Trump in 2025 has raised operating costs for U.S. small businesses. The Federal Reserve’s Small Business Credit Survey showed applications for merchant cash advances – high‑cost short‑term financing – increase to 12 % of firms in 2025, up from 9 % in 2024. Industry observers such as Aharon Margolin of Tariff Recovery Group described the surge as “pretty widespread,” noting that import‑related fees and higher prices are tightening cash flow.

The National Small Business Association (NSBA) reports that two‑thirds of its members have faced higher expenses, with three‑quarters attributing those rises directly to the new tariffs. NSBA President Todd McCracken urged policymakers to consider exemptions for small firms, arguing that the tariffs create economic uncertainty and limit access to affordable financing.