U.S. banks are taking defensive measures to secure their financial stability. The collapse of three regional banks and a series of rate hikes by the Federal Reserve have added to the uncertainty. As a result, more lenders have tightened their lending standards, as revealed by the Federal Reserve’s Senior Loan Officer Opinion Survey. The tightening of lending standards, even before the full impact of the regional banking crisis, is likely to slow down the flow of credit to small businesses and households. Small businesses and marginal households, in particular, are sensitive to changes in the cost and availability of credit, given their limited financial resources and borrowing options.