Biz2Credit Small Business Lending Index™ Finds March 2021 Non-PPP Loan Approval Rates Trending Upwards for All Categories of Lenders
In comparison, one year ago in March 2020, big banks approved 15.4% of the funding requests they received. Biz2Credit, which has been the leading processor of PPP applications in the country since mid-January, finds that PPP loan requests represent the overwhelming percentage of applications made via the online platform in 2021. The Bureau of Labor Statistics reported nonfarm payroll employment rose by 916,000 in March, and the unemployment rate edged down to 6.0 percent in its Jobs Report issued Friday, April 2, 2021.
The labor market continued to reflect the impact of the coronavirus (COVID-19) pandemic. In February, most of the job gains occurred in leisure and hospitality, with smaller gains in temporary help services, health care and social assistance, retail trade, and manufacturing. Many of these jobs are created by small businesses.
“Traditional big bank lending rose slightly in March, but small business loans are still much harder to obtain now than they were before the pandemic,” said Biz2Credit CEO Rohit Arora, one of the nation’s leading experts in small business finance. “Right now, banks have been focused on making Paycheck Protection Program (PPP) loans to small businesses. These loans are backed by the Treasury, so there is little risk to them.”
“All categories of lenders improved slightly in March 2021, but we are nowhere near the approval rates we saw pre-pandemic,” Arora said. “These figures are encouraging because the approvals are trending upwards.”
About Biz2Credit Small Business Lending Index™
The Biz2Credit Small Business Lending Index™ 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 Index™ 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.