NEW YORK–Small business loan approval percentages at banks increased during June, while credit union approval rates were mostly flat, according to the latest Biz2Credit Small Business Lending Index.
According to the Index, the approval rate at big banks ($10 billion and higher) inched up to 15.4% in June, while small banks’ approvals also rose from 20.9% in May to 21.1% in June, according to the latest Biz2Credit Small Business Lending Index.
Loan approves by banks have increased during every month of 2022, according to the Index.
Among non-bank lenders, approval percentages improved slightly, even as credit union lending approvals dipped, Biz2Credit reported.
The Findings
Among the findings:
- Institutional lenders approved 25.6% of loan requests in June, up one-tenth of a percent from 25.5% of loan requests in May.
- Alternative lenders’ approval rates rose from 26.9% in May to 27.1% in June.
- Credit unions slipped slightly from 20.6% in May to 20.5% in June.
Credit Unions are the Exception
“With the exception of credit unions, the approval rates for all categories of lenders inched higher last month,” said Biz2Credit CEO Rohit Arora. “We are nowhere near pre-pandemic approval percentages, however. Still, these are positive signs.
“While the cost of capital for small businesses is rising because most small business funding comes at variable rates, borrowers need capital for growth,” added Arora. “Fortunately, they can find it at a variety of lending sources.”
Biz2Credit said it 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 June 2022, click here.
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