X
X
Follow us on
pinterest
X

  Login/Register with

CALL TOLL FREE800-200-5678
See how we help you get your dream loan

See how we help you get your dream loan

With help of more than 1100 lender partners

Quick Connect

800-200-5678

Follow us on

Biz2Credit Small Business Lending Index Reports 13% Increase in Loans Approved by Big Banks in December 2012

Monthly Index Reports Increases at Big Banks and Small Banks, Decreases for Credit Union and Alternative Lender Approval Rates

NEW YORK, NY, January 9, 2013 Small business loan approval rates at big banks ($10B+ in assets) in December 2012 increased to 14.9%, a figure representing a 13 percent jump from the previous month of November, according to the Biz2Credit Small Business Lending Index, a monthly analysis of 1,000 loan applications on Biz2Credit.com.

The 14.9% approval rate at big banks is the highest recorded by the Biz2Credit Small Business Lending Index and marks a significant jump from the 13.2% approval rate in November and the 9.7% figure of December 2011.

"After a hiccup in November, big banks are coming back strong into the small business lending game," said Rohit Arora, Biz2Credit co-founder and CEO, who oversaw the research. "When we look at how difficult it was to secure capital from large banks a year ago, we can see just how much the lending landscape has improved during all of 2012."

Small bank approval rates also increased in December, climbing to 49.8% from 49.2% in November 2012. A year-to-year comparison indicates that the small bank approval rate in December 2012 was also up from the figure of December 2011, which was 47.1%.

Credit union approvals of small business loans slipped again from 48.4% in November to 47.6% in December 2012. Small business lending approvals rates at credit unions have now dropped in seven consecutive months.

"We are seeing that large and small banks are stepping up in small business lending, while credit unions continue to slide. Many credit unions have not modernized their procedures and still request small business owners to come into their offices and become members before considering loan requests," Arora explained. "Traditional banks are better at automating the lending process and are showing that they are more willing to make small business loans than they were 12 months ago.

Small business loan approvals by alternative lenders accounts receivable financers, merchant cash advance lenders, Community Development Financial Institutions (CDFI), microlenders, and others dipped for a second straight month. In December 2012, alternative lending approval rates dropped to 63.8%, down from 64.5% the previous month.

"As banks opened up the spigots, lesser quality borrowers approached alternative lenders for money. Although alternative lenders are known for their speed and flexibility, the drop in their approval rates seem to indicate they are doing their due diligence and rejecting applicants deemed too risky," Arora said.

Month Big Bank
Approval %
Small Bank
Approval %
Credit Union
Approval %
Alternative Lenders
Approval %

Dec. 2011

9.7%

47.1%

57.4%

62.2%

Jan. 2012

11.7%

47.5%

57.6%

62.4%

Feb. 2012

11.7%

47.6%

57.8%

62.5%

Mar. 2012

10.9%

47.6%

57.9%

63.0%

Apr. 2012

10.6%

45.9%

57.4%

63.0%

May 2012

10.2%

45.5%

57.6%

63.2%

Jun. 2012

11.1%

47.5%

55.8%

62.9%

Jul. 2012

11.3%

47.4%

54.6%

64.1%

Aug. 2012

10.9%

47.8%

52.9%

64.5%

Sept. 2012

14.2%

47.6%

52.4%

64.6%

Oct. 2012

14.8%

50.1%

49.2%

64.7%

Nov. 2012

13.2%

49.2%

48.4%

64.5%

Dec. 2012

14.9%

49.8%

47.6%

63.8%

* Banks with more than $10 billion in assets are classified as "big banks."

* Banks with less than $10 billion in assets are classified as "small banks."

* Credit Unions are considered a category unto themselves in the Biz2Credit Small Biz Lending Index.

* "Alternative lenders" include accounts receivable financers, merchant cash advance lenders, Community Development Financial Institutions (CDFI), micro lenders, and others.

About the Biz2Credit Small Business Lending Index

Biz2Credit analyzed loan requests ranging from $25,000 to $3 million from companies in business more than two years with an average credit score above 680. Unlike other surveys, the results are based on primary data submitted by more than 1,000 small business owners who applied for funding on Biz2Credit's online lending platform, which connects business borrowers with more than 1,100 lenders nationwide.

About Biz2Credit

Founded in 2007, Biz2Credit is a leading credit marketplace connecting small- and medium-sized businesses with lenders, service providers, and complementary business tools. The company matches borrowers to financial institutions based on each business's unique profile -- completed in less than four minutes -- in a safe, efficient, price-transparent environment. Biz2Credit's network consists of 1.6 million users, 1,100+ lenders, credit rating agencies such as D&B and Equifax, and small business service providers including CPAs and lawyers. Having arranged $800 million in funding throughout the U.S., Biz2Credit is widely recognized as the #1 online credit resource for small business loans, lines of credit, equipment loans, working capital and other funding options.

SUBSCRIBE TO OUR MONTHLY NEWSLETTER
Join 250,000+ subscribers to receive the latest offers and updates from Biz2Credit.