According to the Biz2Credit report, approval rates for small banks and alternative lenders will rise 0.2% in July

Loan approval rates continue to rise slowly, according to the July Biz2Credit Lending Report. As in June, small banks and alternative lenders saw the strongest growth, increasing 0.2% each.

Institutional lenders and major banks each saw a 0.1% increase in loan approval rates. Of all lenders, loan rates fell only at credit unions, and that was only a 1% drop.

Biz2Credit Small Business Lending Index August 2022

Rohit Arora, CEO of Biz2Credit, said the increases were “positive signs” but pointed out that for small businesses, financing often comes at variable rates. The variable rates mean that the cost of capital is rising for small businesses as they continue to struggle to find employees.

“Rising labor costs, combined with inflation of 8.6% in May, continue to put pressure on small businesses,” Arora said.

Biz2Credit is an online lending platform and reports monthly on loan approval rates. The report is based on loan applications from 1,000 small business owners.

The report includes loan approval rates through July 2022.

June Biz2Credit Small Business Lending Index Key Data

big banks

Major banks (those with more than $10 billion in assets) achieved an approval rating of 15.5%, up from 15.4% in June. Major banks have seen a steady 0.1% increase in approval rating since March.

Two years ago, loan approval rates for major banks were 28.3%.

small benches

The approval rating for small banks rose to 21.1% in July, from 20.0 in June.

Two years ago, the Small Banks loan approval rate was 50%.

Institutional Lenders

Institutional lenders saw the approval rate rise by a tenth of a point to 25.6% in July. Institutional lenders have seen a stable approval rate of 0.1% since January.

Two years ago, the borrowing rate for Institutional Lenders was 66.5%.

Alternative Lenders

Approval rates of alternative lenders rose to 27.1% in July, up from 26.9 in June.

Two years ago, the approval rate for alternative lenders was 55.9%.

credit unions

Credit Union rates had been stable at 20.6% for several months and fell to 20.5% in July.

Two years ago, the credit union loan approval rate was 39.6%.

How Biz2Credit compiles the report

Biz2Credit analyzes credit applications from companies that have been in business for more than 2 years and also have a credit rating of 680 points or higher. Biz2Credit collects data from more than 1,000 companies to prepare the report.

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This post According to the Biz2Credit report, approval rates for small banks and alternative lenders will rise 0.2% in July was original published at “https://smallbiztrends.com/2022/08/biz2credit-small-business-lending-index-august-2022.html”

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