Small-business owners' confidence in the economy fell again in July as fears about of another recession rose, according to Discover Financial Services.

The Riverwoods, Ill., credit card company said Monday that its Small Business Watch declined by 3.1 points in July, to 83. The index was pegged at 100 when it was created in 2006..

Seventy-five percent of business owners said they believe it is likely or highly likely that the economy will slip into another recession before it fully recovers; 15% do not think another recession is likely and 10% said they were unsure.

In July, 58% of small-business owners rated the economy as poor, up from 51% who did so in June, compared to 7% who rated the economy as excellent or good, down from 12%.

Cash-flow problems plagued fewer business owners in July, as 49% said they did not encounter any temporary cash-flow issues, compared with 45% who said so in June.

Fewer business owners are leaning on credit, as only 10% of small-business owners said they applied for new credit cards, lines of credit or loans within the past three months, down from 17% who said so in July 2009.

"Even though cash-flow issues eased off in July, small-business owners still aren't feeling any positive effects from anything going on in the bigger economy," Ryan Scully, Discover's business card director, said in a press release. "They'll be holding back their economic enthusiasm until they have tangible evidence that their bottom lines are improving."

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