Lending Approval Rates at Big Banks, Institutional Lenders Continue to Surge, According to March 2015 Biz2Credit Small Business Lending IndexsuperscriptstartTMsuperscruptend

Loan Approval Percentages at Small Banks, Alternative Lenders and Credit Unions Drop Again

Small business loan approval rates at big banks and institutional lenders continue to improve, attaining new post-recession highs in March 2015, according to the Biz2Credit Small Business Lending Index, the monthly analysis of 1,000 loan applications on Biz2Credit.com.

Big Banks

Big Banks

Big banks ($10 billion+ in assets) approved 21.6% of small business loan requests in March 2015, slightly up from 21.5% in February. Further, loan approval rates at big banks have increased each month for nearly a year.

Aug 2018
26.5%
Sep 2018
26.7%

Monthly Comparison

Aug 2018
26.5%
Sep 2018
26.7%

Yearly Comparison

"Big banks continue to be strong in small business lending."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Economy

"This is a reflection of overall strength of the economy, the confidence of small business owners, and the investments that big banks have made in their branding and technology."

ROhit Arora

Rohit Arora, Biz2Credit CEO

Small Banks

Small Banks

For the fourth consecutive month, small banks denied more than half of their loan requests to small business owners, as lending approval rates at small banks slipped from 49.6% in February to 49.5% in March. After reaching an all-time Index high in May 2014, lending approval rates at small banks have steadily declined for most of the past year.

Jul 2018
49.7%
Aug 2018
49.8%

Monthly Comparison

Aug 2017
49%
Aug 2018
49.8%

Yearly Comparison

"Smaller banks have seen a gradual decline for nearly a year. They are losing market share to big banks and institutional lenders, which can offer attractive terms and quicker processing".

Rohit Arora

Rohit Arora, Biz2Credit CEO

Institutional lenders

Institutional lenders

Meanwhile, institutional lenders granted 60.9% of funding requests by small business owners in March, an increase from 60.7% in February 2015. Approval rates by institutional lenders have increased each month ever since Biz2Credit began monitoring this category of lenders one year ago.

Jul 2018
64.8%
Aug 2018
64.9%

Monthly Comparison

Jul 2018
63.9%
Aug 2018
64.9%

Yearly Comparison

"Institutional lenders are willing to offer attractive loans to small business owners". "Our Biz2Credit platform enables them to buy small business loans as a solid investment with miniscule risk. Less than one percent of loans on our institutional platform have defaulted since January 2014."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Alternative lenders

Alternative lenders

Approval rates at alternative lenders -- merchant cash advance companies, factors, and other non-bank institutions - dropped to 61.2% in March, from 61.4% in February. Alternative lenders' approval percentages have declined each month since January 2014, coinciding with the emergence of institutional lenders in the small business lending marketplace.

Jul 2018
56.5%
Aug 2018
56.6%

Monthly Comparison

Aug 2017
57.1%
Aug 2018
56.6%

Yearly Comparison

"Alternative lenders have declined as institutional lenders have risen, and this trend shows no signs of letting up". "Entrepreneurs no longer have to pay high interest rates offered by alternative lenders. They can get money just as quickly from marketplace lenders at much lower rates. Bad news for alternative lenders, but good news for borrowers."

Rohit Arora

Rohit Arora, Biz2Credit CEO

Credit unions

Credit unions

Credit unions granted 43.1% of loan applications in March, a decrease from 43.3% in February 2015.

Jul 2018
40.3%
Aug 2018
40.2%

Monthly Comparison

Aug 2017
40.3%
Aug 2018
40.2%

Yearly Comparison

"Credit unions peaked in 2012 in small business lending and have experienced a slow and steady decline nearly every month after that". "They never became the force in small business lending that they had hoped to become."

Rohit Arora

Rohit Arora, Biz2Credit CEO

View Past Months

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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

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September 2019

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

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Aug 2019

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

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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.