Small business loan approval percentages at big banks (more than $10 billion in assets) increased from 14.1% in October to 14.2% in November, according to Biz2Credit’s Small Business Lending Index. Meanwhile, small banks’ approval rates also rose from October’s figure of 19.7% to 19.9% in November.
“Every category of lender, with the exception of credit unions, which remained flat, saw their loan approval percentages rise this month,” Rohit Arora, CEO of Biz2Credit, said. “Approval percentages at banks are rising but more slowly than we would have hoped by now. This is encouraging, but all categories of lenders are far below pre-COVID approval levels.”
Institutional lenders’ approval rates rose from 24.7% in October to 24.8% in November. Alternative lenders’ approval rates rose from 25.6% of small business funding requests in October to 25.8% in November.
“We continue to see small improvements in approval rates at institutional lenders and alternative lenders,” Arora said. “This is something of a bright spot currently.”
Credit unions approved 20.6% of funding requests in November, which was the same percentage as in October.
“Small business lending at credit unions seems to be stalled,” Arora said. “Other types of non-bank lenders are more likely to approve funding requests than credit unions at this point.”
For the index, Biz2Credit analyzed loan requests from companies in business more than two years with credit scores higher than 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.
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