Small Business loan approval rates from all types of lenders continue to rise in very small increments, according to the Biz2Credit Small Business Lending Index released March 15.
The report includes loan approval rates through February 2022. Although approval rates are rising, they’re rising in the same slow-growth pattern that’s existed for more than a year.
Approval rates are only marginally higher than they were a year ago, and half as high as they were 2 years ago.
“We have a long way to go before we reach those marks again – if we ever do,” said Rohit Arora, CEO, Biz2Credit.
Small Business Loan Approval Rates Continue to Rise … Slowly
Here’s a look at how small business loan approval rates are rising at different types of lenders:
Big Banks (those with more than $10 billion in assets) inched up to a 14.7% approval rating during February, up from 14.5% in January.
Two years ago, the loan approval rates for Big Banks were 28.3%.
The approval rating for Small Banks grew to 20.5% in January, compared to 20.3% in January.
Two years ago, the loan approval rate from Small Banks was 50%.
Institutional lenders saw an approval rate rise incrementally from 25.1% in January to 25.2% in February.
Two years ago, the loan rate for institutional lenders was 66.5%.
Alternative lenders approval rates rose from 26.3% in January to 26.5% in February.
Two years ago, the loan approval rate for alternative lenders was 55.9%.
Credit Union loan approval rates stayed the same, 20.7%.
Two years ago, the loan approval rate from credit unions was 39.6%.
How Biz2Credit Compiles the Report
Biz2Credit analyzes loan requests from businesses which have been in business for more than 2 years, which also have a 680 points or higher credit rating. Biz2Credit compiles data from more than 1,000 businesses to prepare the report.