Bank Loan Approval Rates Continued to Climb in August 2017, According to Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend

Big banks grant nearly one-in-four funding requests, while small banks approve almost half of applications they receive from small business borrowers

Loan approval rates at big banks ($10 billion-plus in assets) hit another post-recession high in August 2017, according to the latest Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend , the monthly analysis of more than 1,000 small business loan applications on ahrefstartBiz2Credit.comahrefend. Loan approval percentages of institutional investors also set a new record..

Big Banks

Big Banks

Small business loan approval rates at big banks improved one-tenth of a percent to 24.6% in August, setting a new high for the Biz2Credit Index.

Aug 2018
26.5%
Sep 2018
26.7%

Monthly Comparison

Aug 2018
26.5%
Sep 2018
26.7%

Yearly Comparison

"It's a good time for bank lending; the big banks are approving nearly a quarter of the loan requests they receive from small businesses while the smaller banks are granting almost half of the funding applications they receive."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Small Banks

Small Banks

Loan approval percentages at small banks also rose one-tenth of a percent in August to 49.0% from July's 48.9% figure.

Jul 2018
49.7%
Aug 2018
49.8%

Monthly Comparison

Aug 2017
49%
Aug 2018
49.8%

Yearly Comparison

"The economy is holding up well: the job market is strong, oil prices are still relatively low, and home values have gone up, which makes entrepreneurs feel more secure and confident."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Institutional lenders

Institutional lenders

Institutional lenders' loan approval rates in August remained at 63.9%, the all-time high for the Biz2Credit Small Business Lending Index.

Jul 2018
64.8%
Aug 2018
64.9%

Monthly Comparison

Jul 2018
63.9%
Aug 2018
64.9%

Yearly Comparison

"The dollar is strong, and there is also hope that President Trump's promised tax cuts will pass and spur more economic growth," added Arora, one of the country's leading experts in small business finance. "With interest rates up a bit, it's profitable for lenders to close deals. Thus, bank lending is as strong as it has been the mid-2000s. Despite the daily drama in Washington, global growth has picked up, and the U.S. economy seems to be on solid footing."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Alternative lenders

Alternative lenders

Loan approval rates among alternative lenders continue to decline; approval rates dipped one-tenth of a percent in August to 57.1%. Approval percentages have dropped every month for more than a year.

Jul 2018
56.5%
Aug 2018
56.6%

Monthly Comparison

Aug 2017
57.1%
Aug 2018
56.6%

Yearly Comparison

"Alternative lenders still are players in small business lending because they are willing to provide funding for borrowers who have less than stellar credit or little credit history at all," . "Since they accept higher risk by funding borrowers who do not have stellar credit histories, alternative lenders charge at a higher cost of capital."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Credit unions

Credit unions

Loan approval rates at credit unions dipped a notch to 40.3% in August, thereby reaching a new low for this category of funders on Biz2Credit's index.

Jul 2018
40.3%
Aug 2018
40.2%

Monthly Comparison

Aug 2017
40.3%
Aug 2018
40.2%

Yearly Comparison

"Credit unions continue to lose their relevance in small business lending because they have not invested in technology and are often slow in their deal-making,". "Further, the credit union member business-lending (MBL) cap has not risen above 12.25% of assets. This remains an ongoing issue."

Rohit Arora

Rohit Arora, Biz2Credit CEO

View Past Months

Access Archives

Aug 2019

Small Business Loan Approvals at Banks Continue to Reach New Heights, According to August 2019 Biz2Credit Small Business Lending Index™

View Report
July 2019

Small Business Loan Approvals at Banks Hit Record Highs, According to July 2019 Biz2Credit Small Business Lending IndexTM

Alternative Lending Drops and Credit Unions Sink to a Record Low

View Report
June 2019

Small Business Loan Approvals at Big Banks Hit Record Highs, According to June 2019 Biz2Credit Small Business Lending IndexTM

Big Banks, Regional and Community Banks, and Institutional Lenders Climb, While Alternative Lending Drops and Credit Unions Sink to New Low

View Report
May 2019

Small Business Loan Approvals at Big Banks Stay at Record Post-Recession High, According to May 2019 Biz2Credit Small Business Lending IndexTM

Small Banks and Institutional Lenders Climb, Credit Union Lending Remains at Post-Recession Low, Alternative Lending Stalls Again

View Report

About Biz2Credit Small Business Lending IndexTM

The Biz2Credit Small Business Lending IndexTM is an analysis of 1,000 monthly loan applications on the Biz2Credit website. The Index reports the loan approval rates of small business financing requests at Big Banks ($10 billion+ in assets), local and regional banks and non-bank lenders (credit unions, Community Development Financial Institutions (CDFI), micro lenders, and others).

Unlike other surveys, the results are based on primary data submitted by more than 1,000 entrepreneurs who applied for funding on Biz2Credit's online lending platform, which connects small business borrowers with sources of capital.

Results of the Biz2Credit Small Business Lending IndexTM have been reported by The Wall Street Journal, Bloomberg BusinessWeek, Entrepreneur.com, Bloomberg Radio's "The Hays Advantage", SBA Radio, NY Daily News, Crain's NY Business, Michigan Banker, and other media.