Small Biz Loan Approval Rates Improve to New All-Time Highs at Big Banks, According to Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend

Lending at Small Banks, Institutional Investors Remains Stagnant as Credit Unions Continue to Falter

Loan approval rates at big banks ($10 billion+ in assets) picked up where they left off in 2016, improving to post-recession highs in January 2017, according to the Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend, the monthly analysis of more than 1,000 small business loan applications on Biz2Credit.com. Alternative lenders also experienced an uptick in their loan approval rates in the last month. Additionally, loan approval rates at small banks and institutional investors remained stagnant while approval rates at credit unions dropped.

Big Banks

Big Banks

Small business loan approval rates at big banks improved to 24% in January 2017, marking the sixth consecutive month of increases for this category of lenders. Further, loan approval rates at big banks in a year-to-year comparison are up more than a full percentage point as it slowly creeps towards the one-quarter mark of approvals.

Aug 2018
26.5%
Sep 2018
26.7%

Monthly Comparison

Aug 2018
26.5%
Sep 2018
26.7%

Yearly Comparison

"Despite political turmoil, the market has responded fairly well since Donald Trump took over the White House. He has brought a business friendly approach."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Economy

"There is still a sense of optimism, especially in the banking sector, because of the prospect that Dodd Frank restrictions might be eased."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Small Banks

Small Banks

Loan approval rates at small banks remained stagnant at 48.9% and are near mirror images of its 49% mark in a year-to-year comparison. Although the rates didn't increase, January 2017 marked the fourth consecutive month that the category of lenders avoided a decrease.

Jul 2018
49.7%
Aug 2018
49.8%

Monthly Comparison

Aug 2017
49%
Aug 2018
49.8%

Yearly Comparison

"Dodd-Frank rules had a significant impact on small banks", one of the nation's leading experts in small business finance. "If the regulations are reduced, it could help spur lending by regional and community banks."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Institutional lenders

Institutional lenders

In addition, institutional lenders' loan approval rates remained at 63.4%. This ended a six-month streak of increases for this category of lenders.

Jul 2018
64.8%
Aug 2018
64.9%

Monthly Comparison

Jul 2018
63.9%
Aug 2018
64.9%

Yearly Comparison

"The Dow Jones crossed the milestone mark of 20,000 and optimism to invest in the U.S. is as strong as it has been for a while". "I anticipate global institutional lenders will continue to seek high yields from investments in American small business loans."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Alternative lenders

Alternative lenders

Loan approval rates bounced back considerably at alternative lenders in January, as they approved 58.5% of the funding requests they received, down one-tenth of a percent in a month-to-month comparison. In December 2016, alternative lending approval rates dropped by six-tenths of a percent.

Jul 2018
56.5%
Aug 2018
56.6%

Monthly Comparison

Aug 2017
57.1%
Aug 2018
56.6%

Yearly Comparison

"Advancements in technology by mainstream lenders has taken away the competitive advantage of processing loans quickly that alternative lenders long held". "Once-thriving alternative lenders such as CAN Capital have stopped lending, and smaller alternative lending companies are going out of business. We will see more of consolidation in this category during 2017."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Credit unions

Credit unions

Loan approval rates at credit unions dropped to a new Index low of 40.8% in January.

Jul 2018
40.3%
Aug 2018
40.2%

Monthly Comparison

Aug 2017
40.3%
Aug 2018
40.2%

Yearly Comparison

"Credit unions are hoping that the MBL lending cap could go up with a new regime in Washington". "Otherwise, credit union lending to small businesses will likely remain stagnant."

Rohit Arora

Rohit Arora, Biz2Credit CEO

View Past Months

Access Archives

October 2019

Big Banks’ Small Business Loan Approvals Hit New Record in October, According to Biz2Credit Small Business Lending Index™

Strength seen in lending by big banks, small banks, and institutional investors last month

View Report
September 2019

Small Business Loan Approvals at Big Banks Hit New Record in September, According to Biz2Credit Small Business Lending Index™

View Report
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

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.