Small business lending continues trending upward in two sectors at least.
Data from Biz2Credit shows that loan approval rates for small businesses at big banks hit a new post-recession high in March. According to the monthly Biz2Credit Small Business Lending Index, a record 21.6 percent of loan requests to big banks from small businesses were approved in March.
The data is drawn from a survey of loan applications by more than 1,000 small business owners who used Biz2Credit’s online lending platform to connect to lenders over that period.
The figure is up slightly from the 21.5 percent small business loan approval rate in February. The March rate again marks a new high for small business loan approvals at big banks since the end of the Great Recession.
And Biz2Credit notes that small business loan approval rates at big banks has continued to rise for almost all of last year.
In a statement accompanying the company’s March report, Biz2Credit CEO Rohit Arora, explains:
“Big banks continue to be strong in small business lending. 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.”
Biz2Credit’s data continues to show that big banks are willing to invest in small businesses by approving a higher rate of their loan applications. However, previous Biz2Credit Small Business Lending Index reports suggest big banks are generally more interested in finding small businesses in search of big money.
Small Business Loan Approval Up With Institutional Lenders
Another place small business borrowers are finding ever increasing approval rates is among institutional lender. Just like the small business loan approval rates at big banks, approval at these lenders also continued to increase last month.
And since Biz2Credit began tracking small business loan approval rates at institutional lenders, the figure has never gone down. In March, 60.9 percent of all small business loan applications to institutional lenders were approved.
While these lenders continue to back small businesses by approving a higher rate of their loan applications, the same can not be said for small banks.
In March, small banks approved 49.5 of the small business loan applications they received. It’s worth noting that this is the third consecutive month that small banks failed approve at least half their loan approvals.
Arora reiterates that the shift away from small banks is a reflection on online marketing efforts. He says, in a statement:
“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.”
This article, “Biz2Credit: Small Business Lending Continues Upward Trend” was first published on Small Business Trends