Loan Approvals Increase For Small Businesses
At Banks With More Than $10B In Assets
Small-business loan approvals jumped to an all-time high of 16.8% at big banks (those with more than $10 billion in assets) in April, according to the Biz2Credit index, a monthly analysis of 1,000 loan applications. Year-over-year, approvals at big banks are up more than 50%. “Big banks such as TD Bank, Sovereign and Wells Fargo are investing heavily in new technology to increase speed and service of approvals,” says Biz2Credit CEO Rohit Arora, who oversaw the research. “As the economy continues to rebound, lending conditions are gradually improving.”
Distributors like Nicole McNamee think this is great news. “Small businesses are the heart of our economy,” says McNamee, director of new business development at POP Solutions (asi/359180). “I think if the rates are affordable, it is a great opportunity to grow your business. However it is only a small piece of the puzzle – you have to make sure that the business owner still uses the money wisely to hire good people and make sound business decisions with factories.”
The survey found that higher credit-quality customers are first opting to apply for loans with big banks now that these institutions are more willing to lend and the service has improved. Lending at small banks also increased for the fifth consecutive month, reaching a new all-time index high of 50.9%.