Small business loan approval surging, driven by big banks

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In the March 2016 Biz2Credit Small Business Lending Index, study authors found that, while loan approvals from smaller lenders and credit unions dipped slightly, small business loans at larger banks hit a new post-recession high. Banks with over $10 billion in assets approved roughly 23 percent of funding requests in the month of March, rising two-tenths of a percent from the previous month. International funding in particular played a bigger role than ever before – even as alternative lending solutions lost ground.

Alternative Small Business Loans

“The slip in alternative lending is particularly noteworthy.”

“Big banks continue to loosen the spigot and are allowing more of a free flow of capital to small business,” said Biz2Credit CEO Rohit Arora in the study. “International funds are getting into the marketplace. Because the yields in small business lending are attractive, increasing numbers of institutional lenders are getting into the game.”

The slip in alternative lending is particularly noteworthy: According to the study’s authors, Institutional lenders entering the small business market seemingly muscled out some entrenched alternative lending solutions, causing approvals to fall from 60.8 percent to 60.7 percent in February. Big banks like JPMorgan Chase have begun unveiling small business-oriented technology platforms, like its most recent offering in partnership with alternative lender OnDeck.

“The process will be entirely digital, with approval and funding generally received within one day,” JPMorgan Chief Executive Jamie Dimon wrote in a recent letter to the bank’s shareholders. According to Business Insider, the bank will begin its program by pre-screening a selection of nearly 4 million customers and inviting them to apply for a loan up to $250,000. While the software hosting the program is offered by OnDeck, the underwriting standards are directly from Chase, potentially mitigating the losses some peer-to-peer lenders have experienced due to weak underwriting.

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In the March 2016 Biz2Credit Small Business Lending Index, study authors found that, while loan approvals from smaller lenders and credit unions dipped slightly, small business loans at larger banks hit a new post-recession high. Banks with over $10 billion in assets approved roughly 23 percent of funding requests in the month of March, rising two-tenths of a percent from the previous month. International funding in particular played a bigger role than ever before – even as alternative lending solutions lost ground. 

"The slip in alternative lending is particularly noteworthy."

"Big banks continue to loosen the spigot and are allowing more of a free flow of capital to small business," said Biz2Credit CEO Rohit Arora in the study. "International funds are getting into the marketplace. Because the yields in small business lending are attractive, increasing numbers of institutional lenders are getting into the game."

The slip in alternative lending is particularly noteworthy: According to the study's authors, Institutional lenders entering the small business market seemingly muscled out some entrenched alternative lending solutions, causing approvals to fall from 60.8 percent to 60.7 percent in February. Big banks like JPMorgan Chase have begun unveiling small business-oriented technology platforms, like its most recent offering in partnership with alternative lender OnDeck.

"The process will be entirely digital, with approval and funding generally received within one day," JPMorgan Chief Executive Jamie Dimon wrote in a recent letter to the bank's shareholders. According to Business Insider, the bank will begin its program by pre-screening a selection of nearly 4 million customers and inviting them to apply for a loan up to $250,000. While the software hosting the program is offered by OnDeck, the underwriting standards are directly from Chase, potentially mitigating the losses some peer-to-peer lenders have experienced due to weak underwriting.

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In the March 2016 Biz2Credit Small Business Lending Index, study authors found that, while loan approvals from smaller lenders and credit unions dipped slightly, small business loans at larger banks hit a new post-recession high. Banks with over $10 billion in assets approved roughly 23 percent of funding requests in the month of March, rising two-tenths of a percent from the previous month. International funding in particular played a bigger role than ever before – even as alternative lending solutions lost ground. 

"The slip in alternative lending is particularly noteworthy."

"Big banks continue to loosen the spigot and are allowing more of a free flow of capital to small business," said Biz2Credit CEO Rohit Arora in the study. "International funds are getting into the marketplace. Because the yields in small business lending are attractive, increasing numbers of institutional lenders are getting into the game."

The slip in alternative lending is particularly noteworthy: According to the study's authors, Institutional lenders entering the small business market seemingly muscled out some entrenched alternative lending solutions, causing approvals to fall from 60.8 percent to 60.7 percent in February. Big banks like JPMorgan Chase have begun unveiling small business-oriented technology platforms, like its most recent offering in partnership with alternative lender OnDeck.

"The process will be entirely digital, with a
pproval and funding generally received within one day," JPMorgan Chief Executive Jamie Dimon wrote in a recent letter to the bank's shareholders. According to Business Insider, the bank will begin its program by pre-screening a selection of nearly 4 million customers and inviting them to apply for a loan up to $250,000. While the software hosting the program is offered by OnDeck, the underwriting standards are directly from Chase, potentially mitigating the losses some peer-to-peer lenders have experienced due to weak underwriting.

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In the March 2016 Biz2Credit Small Business Lending Index, study authors found that, while loan approvals from smaller lenders and credit unions dipped slightly, small business loans at larger banks hit a new post-recession high. Banks with over $10 billion in assets approved roughly 23 percent of funding requests in the month of March, rising two-tenths of a percent from the previous month. International funding in particular played a bigger role than ever before – even as alternative lending solutions lost ground. 

"The slip in alternative lending is particularly noteworthy."

"Big banks continue to loosen the spigot and are allowing more of a free flow of capital to small business," said Biz2Credit CEO Rohit Arora in the study. "International funds are getting into the marketplace. Because the yields in small business lending are attractive, increasing numbers of institutional lenders are getting into the game."

The slip in alternative lending is particularly noteworthy: According to the study's authors, Institutional lenders entering the small business market seemingly muscled out some entrenched alternative lending solutions, causing approvals to fall from 60.8 percent to 60.7 percent in February. Big banks like JPMorgan Chase have begun unveiling small business-oriented technology platforms, like its most recent offering in partnership with alternative lender OnDeck.

"The process will be entirely digital, with approval and funding generally received within one day," JPMorgan Chief Executive Jamie Dimon wrote in a recent letter to the bank's shareholders. According to Business Insider, the bank will begin its program by pre-screening a selection of nearly 4 million customers and inviting them to apply for a loan up to $250,000. While the software hosting the program is offered by OnDeck, the underwriting standards are directly from Chase, potentially mitigating the losses some peer-to-peer lenders have experienced due to weak underwriting.

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In the March 2016 Biz2Credit Small Business Lending Index, study authors found that, while loan approvals from smaller lenders and credit unions dipped slightly, small business loans at larger banks hit a new post-recession high. Banks with over $10 billion in assets approved roughly 23 percent of funding requests in the month of March, rising two-tenths of a percent from the previous month. International funding in particular played a bigger role than ever before – even as alternative lending solutions lost ground. 

"The slip in alternative lending is particularly noteworthy."

"Big banks continue to loosen the spigot and are allowing more of a free flow of capital to small business," said Biz2Credit CEO Rohit Arora in the study. "International funds are getting into the marketplace. Because the yields in small business lending are attractive, increasing numbers of institutional lenders are getting into the game."

The slip in alternative lending is particularly noteworthy: According to the study's authors, Institutional lenders entering the small business market seemingly muscled out some entrenched alternative lending solutions, causing approvals to fall from 60.8 percent to 60.7 percent in February. Big banks like JPMorgan Chase have begun unveiling small business-oriented technology platforms, like its most recent offering in partnership with alternative lender OnDeck.

"The process will be entirely digital, with approval and funding generally received within one day," JPMorgan Chief Executive Jamie Dimon wrote in a recent letter to the bank's shareholders. According to Business Insider, the bank will begin its program by pre-screening a selection of nearly 4 million customers and inviting them to apply for a loan up to $250,000. While the software hosting the program is offered by OnDeck, the underwriting standards are directly from Chase, potentially mitigating the losses some peer-to-peer lenders have experienced due to weak underwriting.

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