Small business loan approval rates for big banks remained at a record high 27% in January 2019, according to the Biz2Credit Small Business Lending IndexTM, which examines more than 1,000 small business credit applications made via its online lending platform.
"Beth Goldberg, Director of SBA's New York District, the agency's largest of 68 offices across the country, said that SBA processed more than 1,100 7(a) loans worth half a billion dollars in its first week back after the shutdown. ."
"Our top priority was and continues be to working with SBA lenders to approve and process small business loans to get capital into the hands of the businesses that need it," Goldberg said. "Remember that through the shutdown, SBA's Resources Partners - Small Business Development Centers, SCORE Chapters and Women's Business Centers continued to work with entrepreneurs, counseling them on all aspects of their businesses."
"Goldberg added that since reopening on January 28th, her office has guaranteed more than 200 SBA loans worth $59.3 million. "
"Meanwhile, the Jobs Report released on Feb. 1 saw an unexpected rise in job creation, and Federal Reserve opted not to raise interest rates at its first meeting of the year. "
"The government shutdown ultimately did not have a major impact on small business lending," said Biz2Credit CEO Rohit Arora, one of the nation's leading experts in small business finance. "There are still hurdles, however. Many companies are waiting for SBA loans that have not yet been processed."
Business loan approval rates dropped three-tenths of a percent at regional and community banks in December 2018. Small bank approvals dropped a full percentage point from 49.9% in December 2018 to 48.9% in January.
" Overall, the economy is still performing well on many levels, "added Arora, who oversees the research. "This is beneficial to the small business lending market."
Institutional lenders climbed up to 65.1 %, a jump of three-tenths of a percent from December's mark of 64.8%.
Loan approval rates among alternative lenders rose from 56.6% in December to 57.3% in January, a jump of seven-tenths of a percent.
"As SBA lending stalled during the shutdown, alternative lenders took advantage of the opportunity by lending money to business owners in need of quick capital," Arora explained. "Non-bank lenders fill the gaps many times for borrowers who cannot get money from traditional sources."
Credit unions approvals increased to 40.3% of loan applications in January, up one-tenth of a percentage from December, according to the Biz2Credit Index.
"Despite the government shutdown, January was a solid month for small business lending," Arora said. "