WASHINGTON – If credit unions have been sensing that competition for the small business market has increased, their suspicions aren't wrong. A study released by the National Federation of Independent Business (NFIB), "Credit, Banks and Small Business – The New Century" found that 42% of surveyed small-business owners believe competition for their banking business has increased over the past three years, compared to 38% in 1995, which is the last year the study was conducted. Small firms continue to see increases in fees, the study findings showed, both on the number of services and the unit cost. Not surprising, where owners reported more competition, they also were more likely to have reported improved quality of service, as well as better lending terms. The study also showed that: 35% of small business owners reported a merger or acquisition of their primary financial institution in the prior four years, up from 25% that was reported in the 1995 survey; small business owners are not yet comfortable with a lot of the new technology that's part of the modern financial services industry. Only 11% of the respondents indicated they do any part of their banking business online, and just 1% filed their most recent loan application online. In related NFIB statistics based on a survey of small and independent business owners, the organization's monthly report for February 2003 showed small business credit conditions might be tightening. Seven percent of those surveyed reported that loans were harder to get Three percent reported higher rates on new loans, and 14% reported lower rates. The average rate paid on short-term loans was 6.8%. Regular borrowing activity was reported by 38% of all small businesses, up two percentage points. Overall, the survey said "credit markets remain very friendly and funds are cheap in nominal terms. However, in an environment where prices are falling for many firms, the real cost of these funds is high and falls directly to the bottom line."