Grid background image
Grid background image
October/2022

Biz2Credit Small Business Lending Index™ Reports Loan Approval Percentages Dropped at Banks and Non-Bank Lenders in October 2022

Lending rates at big banks dropped for the fourth consecutive month, while approvals percentages at small banks dipped for the first time in over a year. Non-bank lenders also stalled.
Left grey arrow Back to Lending Index List
Icon image
Big BanksImage
Banks with assets greater than $10 billion
Small business loan approval percentages at big banks dropped from 14.9% in September to 14.7% in October, the lowest total since February 2022, according to the latest Biz2Credit Small Business Lending Index™ released today.

Total nonfarm payroll employment increased by 261,000 in October, and the unemployment rate rose slightly to 3.7%, according to the Jobs Report released by the U.S. Bureau of Labor Statistics that released on Friday, November 4, 2022. Notable job gains occurred in health care, professional and technical services, and manufacturing. Many of these positions are created by small businesses, which are responsible for the lion’s share of new jobs in the private sector economy.

Biz2Credit analyzed loan requests from companies in business more than two years with credit scores above 680. The results are based on primary data submitted by more than 1,000 small business owners who applied for funding on Biz2Credit's platform. To view the report for October 2022, click here.

Monthly Comparison
-0.2%
14.7%
October 2022
14.9%
September 2022
Yearly Comparison
+0.6%
14.7%
October 2022
14.1%
October 2021
Grid image background Grid image background

"Continued inflation and uncertainty over how high the Federal Reserve would set interest rates cast a shadow over small business lending in October,” said Rohit Arora, CEO of Biz2Credit and one of the nation’s leading experts in small business finance. “Approval percentages at big banks dropped for the fourth consecutive month in October. Likewise, approvals at small banks, which had increased steadily since April 2021, dropped for the first time in well over a year.”

Rohit Arora
Biz2Credit CEO
Icon image
Small Banks Image
Banks with assets less than $10 billion
Approval percentages of business loan applications at small banks declined by three-tenths of a percent from 21.5% in September to 21.2% in October.
Monthly Comparison
-0.3%
21.2%
October 2022
21.5%
September 2022
Yearly Comparison
+1.5%
21.2%
October 2022
19.7%
October 2021
Grid image background Grid image background

“While monetary policy aims to curb inflation, it hasn’t showed obvious signs of working yet,” Arora added. “This is bad news for small businesses in search of capital. Loans are harder to get, and the cost of capital has gone up. This is a double whammy for business owners.”

Rohit Arora
Biz2Credit CEO
Icon image
Institutional Lenders Image
Investment groups or large investment portfolios such as insurance funds, mutual funds and hedge funds
Institutional lenders granted 25.7% of loan requests in October, a decrease of three-tenths of a percent from September’s figure of 26%.
Monthly Comparison
-0.3%
25.7%
October 2022
26.0%
September 2022
Yearly Comparison
+1.0%
25.7%
October 2022
24.7%
October 2021
Icon image
Alternative Lenders Image
Independent lending organizations not licensed as banks or credit unions
Approval percentages of alternative lenders fell from 27.5% in September to 27.3% in October.
Monthly Comparison
-0.2%
27.3%
October 2022
27.5%
September 2022
Yearly Comparison
+1.7%
27.3%
October 2022
25.6%
October 2021
Grid image background Grid image background

“Inflation is a big concern for small business owners, whose costs continue to rise and eat into profitability. However, the opposite of inflation is a recession, which is also problematic for small companies,” Arora said. “It’s a tough time for small business owners right now.”

Rohit Arora
Biz2Credit CEO
Icon image
Credit Unions Image
Arora says the lending industry is watching closely what the SBA does, specifically whether the agency will approve fintech companies to process SBA loans.
Lending at credit unions remained stagnant at 20.4%.
Monthly Comparison
+0.0%
20.4%
October 2022
20.4%
September 2022
Yearly Comparison
-0.2%
20.4%
October 2022
20.6%
October 2021

The Report

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.

Hurricane Ian ALERT:
We are supporting small businesses affected by Hurricane Ian. Visit our disaster relief hub or apply for financing.
close
x
”Your browser does not support the images displayed on this website. Please try to access the site from the latest version of Google Chrome, Safari, Microsoft Edge or Mozilla Firefox”