The October Thomson Reuters/PayNet Small Business Lending Index (SBLI), which is a leading economic indicator of GDP, decreased by 5% to 131.7 compared to September’s value, which was restated from 140.4 to 137.9.

On a year-over-year basis, the SBLI is flat compared to October of last year and marks only the second time the SBLI has failed to increase over the prior year since February of 2010.

“Borrowing and investment by small businesses fell abruptly last month and at the same time the percentage of loans past due fell. Small businesses are either seeing less demand for their goods and services or becoming cautious about their future,” said William Phelan, president of PayNet. “While this month may be an outlier, it stands in stark contrast to the faster trend line for borrowing and investment over the past year.”

Loans past due remain muted with the Thomson Reuters/PayNet Small Business Delinquency Index (SBDI) 31-90 days past due standing unchanged at 1.19% from September to October. On a year-over-year basis, moderate delinquencies declined six basis points. This is the fifth consecutive month of year-over-year decreases after 12 straight months of increases.

Several industries showed slight rises in delinquencies, such as transportation which increased six basis points to 1.04%, marking the eighth consecutive monthly increase and its highest level since March of 2014. Construction and health care delinquencies are both up four basis points to 1.67% and 1.21%, respectively.

“Lower small business investment and lower loans past due remind of the uncertainty of 2012 when small businesses held back on bold investments and undertook a de-risking of their financial position,” said Phelan. “Slower borrowing and investment by small businesses means slower GDP for the next quarter.”