Interest rates have a significant ripple effect on small business borrowing, impacting everything from loan availability to overall economic conditions. When rates increase, the cost of loans rises, leading many small businesses to reconsider their financing needs. This can result in a slowdown of business investments and expansion plans, ultimately affecting job creation and economic growth. Additionally, rising rates can lead to tighter credit markets, where lenders become more cautious in approving loans. Understanding these dynamics can help small business owners adapt their strategies and explore alternative financing options.