Loan Approval Percentages Rise for All Categories of Lenders, Reach New Heights for Banks and Institutional Lenders in June, According to The Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend
Optimism About The Economy Reflected in Figures
ahrefstartSmall business loanahrefend approval rates for big banks (26.1%) continued the upswing with yet another new high in June 2018, according to the Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend released today. The analysis examined more than 1,000 credit applications from small businesses on Biz2Credit.com.
Big Banks
The June approval percentage for big banks (assets of $10 billion+) rose two-tenths of a percent from May's figure of 25.9%, according to Biz2Credit's monthly report.
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"The continued strength of the economy and optimism among small business owners are important factors in these results. Entrepreneurs are confident and are investing in the growth of their companies,"
Rohit Arora, Biz2Credit CEO
"The markets are performing well, unemployment is just 3.8%, and the small business optimism is extremely high, according to the monthly NFIB survey."
Rohit Arora, Biz2Credit CEO
Small Banks
ahrefstartSmall business loanahrefend approval rates rose at regional and community banks. Small banks granted 49.6% of the funding requests they received in June, up two-tenths from May. It represents the highest figure for small banks since April 2015.
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"Small banks are approving nearly half of the loan applications they receive. Many of them are involved in making ahrefstartSBA loansahrefend, which provide government guarantees that mitigate risk for the lenders," Arora explained. "Smaller banks are a good source of capital for startups and companies with less than stellar credit ratings."
Rohit Arora, Biz2Credit CEO
Institutional lenders
institutional lenders set yet another new Index record 64.8%, up one-tenth of a percent from May.
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"These lenders (pension funds, insurance companies, and others), are seeking high yields and finding them in small business lending,"."Their volumes are growing each year, and they are funding companies while offering attractive rates and terms. Institutional lenders have become a real force in small business funding."
Rohit Arora, Biz2Credit CEO
Alternative lenders
Loan approval rates among alternative lenders rebounded to 56.5 % in June from 56.4% in May.
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"Firms that don't qualify for traditional small business loans because they have not been in business long or have poor credit histories are able to obtain capital from non-bank lenders,". "Alternative lenders charge high interest rates, but are able to provide funding for companies that need money quickly."
Rohit Arora, Biz2Credit CEO
Credit unions
Credit unions approved 40.3% of loan applications in June, up two-tenths of a percent from May, which had set a record low for the Biz2Credit Small Business Lending Index.
Monthly Comparison
Yearly Comparison
"Even credit union lending to small business picked up in June,". "Credit union approvals had been steadily declining this year. June's figure was the highest since January 2018."
Rohit Arora, Biz2Credit CEO
View Past Months
Access Archives
| February 2021 |
Biz2Credit Small Business Lending Index™ Finds Loan Approval Rates in February 2021 Changed Little from January, But Dropped Dramatically from February 2020 |
|
As Small Business Businesses Apply for PPP Funding, Approval Percentages for Traditional Loans Plummet |
| View Report |
| January 2021 |
Biz2Credit Small Business Lending Index™ Reports Loan Approval Rates at Banks Increased Slightly in January 2021, But Are Down More Than 50% from One Year Ago |
| View Report |
| December 2020 |
Biz2Credit Small Business Lending Index™ Reports Loan Approval Rates at Banks Declined in December 2020, Are Down More Than 50 Percent from One Year Ago |
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Approval percentages for all categories of lenders dropped more than 50% from December 2019 |
| View Report |
| November 2020 |
Biz2Credit Small Business Lending Index™ Reports Loan Approval Rates at Banks Declined in November 2020, Are Down More Than 50 Percent from One Year Ago |
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Approval percentages are down 50% or more for all categories of small business lenders as the pandemic surges |
| 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.