GITNUXREPORT 2025

Small Business Lending Statistics

Small businesses rely heavily on diverse funding sources, expanding online options.

Jannik Linder

Co-Founder of Gitnux, specialized in content and tech since 2016.

First published: April 29, 2025

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Statistic 1

About 50% of small businesses rely on bank loans for financing

Statistic 2

58% of small business owners say access to capital is their top challenge

Statistic 3

The Small Business Administration (SBA) guarantees over $40 billion in loans annually

Statistic 4

Women-owned small businesses access approximately 4% less funding than male-owned businesses

Statistic 5

The median time to get approved for a small business loan is about 20 days

Statistic 6

Over 60% of small business loans come from non-traditional sources, including online lenders

Statistic 7

About 55% of small businesses report difficulty in obtaining funding from banks in the last year

Statistic 8

Startup businesses are 30% more likely to be denied funding compared to established small businesses

Statistic 9

Approximately 20% of small business lending goes to certain industries like retail and hospitality

Statistic 10

Minority-owned small businesses are 22% less likely to receive financing than non-minority-owned counterparts

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65% of small businesses that received a loan reported positive impacts on revenue and growth

Statistic 12

The overall approval rate for crowdfunding as a small business funding source was about 21% in 2022

Statistic 13

Small business loan denials are most common among businesses with less than 2 years of operation, at a rate of approximately 45%

Statistic 14

The largest share of small business loans is used for working capital, accounting for 45% of total loan purposes

Statistic 15

Approximately 47% of small business owners have used personal savings to fund their business

Statistic 16

The COVID-19 pandemic led to a 40% increase in small business loan applications in 2020, then a subsequent stabilization

Statistic 17

Approximately 68% of small business owners express interest in alternative financing options such as angel investors or venture capital

Statistic 18

Small business loans with interest rates below 7% constitute about 55% of all approved loans

Statistic 19

About 30% of small business owners rely on government grants and subsidies for funding

Statistic 20

The average time to secure funding through a merchant cash advance is around 3 days, much faster than traditional loans

Statistic 21

Small business lending via credit unions accounts for approximately 10% of all small business loans

Statistic 22

Less than 20% of small business owners seek external funding within their first year of operation, indicating cautious borrowing habits

Statistic 23

80% of microbusinesses (fewer than 5 employees) did not seek any external funding in 2022

Statistic 24

The share of small businesses that use invoice financing as a funding source has increased by 18% over the past three years

Statistic 25

Roughly 65% of small business owners report that they are unlikely to seek additional funding in the next 12 months, citing satisfaction with current finances

Statistic 26

The largest proportion of small business lending occurs in the manufacturing and construction sectors, accounting for about 40% of total loans

Statistic 27

Small businesses with fewer than 10 employees are twice as likely to experience financing difficulties compared to larger small businesses

Statistic 28

In 2022, the average interest rate for small business term loans ranged from 6.5% to 13%, depending on creditworthiness

Statistic 29

Approximately 31% of small business owners use alternative financing methods like crowdfunding, factoring, or revenue-based loans

Statistic 30

Small businesses in rural areas are about 25% less likely to secure traditional bank loans compared to urban counterparts

Statistic 31

Approximately 55% of small businesses that received funding reported improvements in cash flow

Statistic 32

Less than 10% of small business loans are made to businesses with a credit score below 650, indicating a high threshold for creditworthiness

Statistic 33

About 40% of small businesses plan to seek additional financing in the next year, primarily for expansion and technology upgrades

Statistic 34

The participation of women in small business lending increased by 12% from 2019 to 2022, with women receiving 30% of total small business funding

Statistic 35

The default rate on small business loans is roughly 3.5%

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The typical repayment period for small business loans is about 5-7 years

Statistic 37

The approval rate for small business loans at community banks is approximately 70%

Statistic 38

Microloans (loans under $50,000) make up about 35% of all SBA loans

Statistic 39

Microloans typically have higher interest rates, averaging around 9-13%, compared to traditional bank loans

Statistic 40

The median loan amount for online lenders is approximately $20,000, significantly lower than traditional bank loans

Statistic 41

In 2023, the most common debt size for small business loans was between $100,000 and $250,000

Statistic 42

Loan approval rates tend to be higher for businesses with established credit histories, with approved applicants having an average credit score above 700

Statistic 43

The average small business loan size for startups is approximately $50,000, reflective of initial capital needs

Statistic 44

The share of SBA 7(a) loans used for equipment purchase has decreased to about 20% in recent years, as more funds are allocated for working capital

Statistic 45

Small business loans approved through fintech platforms tend to have higher approval rates for startups than traditional banks, at about 75%

Statistic 46

The average repayment period for invoice financing is approximately 60-90 days, allowing quick access to working capital

Statistic 47

Small businesses account for approximately 44% of U.S. economic activity

Statistic 48

The online small business lending market grew by approximately 25% in 2022

Statistic 49

The share of small business loans originating through online lenders increased from 12% in 2018 to 27% in 2022

Statistic 50

Revenue-based financing is gaining popularity with about 10% of small business loan applications involving this method

Statistic 51

The trend of ‘delegated lending’ where community lenders use third-party platforms increased by 15% in 2022

Statistic 52

The number of small business loan applications processed digitally increased by 35% in 2022

Statistic 53

The proportion of small business loans approved via peer-to-peer lending platforms increased from 8% in 2019 to 15% in 2022

Statistic 54

The average duration for online lender approvals is around 24 hours, significantly faster than traditional bank approvals

Statistic 55

The number of fintech startups offering small business loans increased by 45% between 2020 and 2023

Statistic 56

The typical small business loan interest rate on online lending platforms is around 8%, with some offering rates as low as 5%

Statistic 57

Growth in online and mobile banking has contributed to a 25% increase in small business loan applications processed digitally in 2022

Statistic 58

The average small business loan size is around $585,000

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Key Highlights

Small businesses account for approximately 44% of U.S. economic activity
The average small business loan size is around $585,000
About 50% of small businesses rely on bank loans for financing
58% of small business owners say access to capital is their top challenge
The approval rate for small business loans at community banks is approximately 70%
The Small Business Administration (SBA) guarantees over $40 billion in loans annually
Microloans (loans under $50,000) make up about 35% of all SBA loans
Women-owned small businesses access approximately 4% less funding than male-owned businesses
The median time to get approved for a small business loan is about 20 days
Over 60% of small business loans come from non-traditional sources, including online lenders
The online small business lending market grew by approximately 25% in 2022
Microloans typically have higher interest rates, averaging around 9-13%, compared to traditional bank loans
About 55% of small businesses report difficulty in obtaining funding from banks in the last year

Discover how the evolving landscape of small business lending is shaping the future of entrepreneurship, from traditional bank loans to innovative online platforms and the persistent challenges faced by underserved industries.

Access to Capital and Funding Sources

About 50% of small businesses rely on bank loans for financing
58% of small business owners say access to capital is their top challenge
The Small Business Administration (SBA) guarantees over $40 billion in loans annually
Women-owned small businesses access approximately 4% less funding than male-owned businesses
The median time to get approved for a small business loan is about 20 days
Over 60% of small business loans come from non-traditional sources, including online lenders
About 55% of small businesses report difficulty in obtaining funding from banks in the last year
Startup businesses are 30% more likely to be denied funding compared to established small businesses
Approximately 20% of small business lending goes to certain industries like retail and hospitality
Minority-owned small businesses are 22% less likely to receive financing than non-minority-owned counterparts
65% of small businesses that received a loan reported positive impacts on revenue and growth
The overall approval rate for crowdfunding as a small business funding source was about 21% in 2022
Small business loan denials are most common among businesses with less than 2 years of operation, at a rate of approximately 45%
The largest share of small business loans is used for working capital, accounting for 45% of total loan purposes
Approximately 47% of small business owners have used personal savings to fund their business
The COVID-19 pandemic led to a 40% increase in small business loan applications in 2020, then a subsequent stabilization
Approximately 68% of small business owners express interest in alternative financing options such as angel investors or venture capital
Small business loans with interest rates below 7% constitute about 55% of all approved loans
About 30% of small business owners rely on government grants and subsidies for funding
The average time to secure funding through a merchant cash advance is around 3 days, much faster than traditional loans
Small business lending via credit unions accounts for approximately 10% of all small business loans
Less than 20% of small business owners seek external funding within their first year of operation, indicating cautious borrowing habits
80% of microbusinesses (fewer than 5 employees) did not seek any external funding in 2022
The share of small businesses that use invoice financing as a funding source has increased by 18% over the past three years
Roughly 65% of small business owners report that they are unlikely to seek additional funding in the next 12 months, citing satisfaction with current finances
The largest proportion of small business lending occurs in the manufacturing and construction sectors, accounting for about 40% of total loans
Small businesses with fewer than 10 employees are twice as likely to experience financing difficulties compared to larger small businesses
In 2022, the average interest rate for small business term loans ranged from 6.5% to 13%, depending on creditworthiness
Approximately 31% of small business owners use alternative financing methods like crowdfunding, factoring, or revenue-based loans
Small businesses in rural areas are about 25% less likely to secure traditional bank loans compared to urban counterparts
Approximately 55% of small businesses that received funding reported improvements in cash flow
Less than 10% of small business loans are made to businesses with a credit score below 650, indicating a high threshold for creditworthiness
About 40% of small businesses plan to seek additional financing in the next year, primarily for expansion and technology upgrades

Access to Capital and Funding Sources Interpretation

Despite the vital role of bank loans and innovative funding sources in fueling small business growth, nearly half of entrepreneurs face daunting hurdles—highlighting a financial landscape where access remains uneven, industry disparities persist, and entrepreneurs are increasingly turning to alternative avenues to turn their visions into reality.

Demographic Trends and Ownership Characteristics

The participation of women in small business lending increased by 12% from 2019 to 2022, with women receiving 30% of total small business funding

Demographic Trends and Ownership Characteristics Interpretation

The uptick in women's participation in small business lending—rising 12% from 2019 to 2022 and accounting for 30% of total funding—illustrates both progress and the ongoing journey toward equitable financial opportunities in entrepreneurship.

Loan Performance, Default Rates, and Repayment Terms

The default rate on small business loans is roughly 3.5%
The typical repayment period for small business loans is about 5-7 years

Loan Performance, Default Rates, and Repayment Terms Interpretation

With a modest 3.5% default rate and a repayment horizon of 5 to 7 years, small business loans are a gamble that nearly always pays off for lenders, provided entrepreneurs can sustain the long game.

Loan Types, Sizes, and Approval Rates

The approval rate for small business loans at community banks is approximately 70%
Microloans (loans under $50,000) make up about 35% of all SBA loans
Microloans typically have higher interest rates, averaging around 9-13%, compared to traditional bank loans
The median loan amount for online lenders is approximately $20,000, significantly lower than traditional bank loans
In 2023, the most common debt size for small business loans was between $100,000 and $250,000
Loan approval rates tend to be higher for businesses with established credit histories, with approved applicants having an average credit score above 700
The average small business loan size for startups is approximately $50,000, reflective of initial capital needs
The share of SBA 7(a) loans used for equipment purchase has decreased to about 20% in recent years, as more funds are allocated for working capital
Small business loans approved through fintech platforms tend to have higher approval rates for startups than traditional banks, at about 75%
The average repayment period for invoice financing is approximately 60-90 days, allowing quick access to working capital

Loan Types, Sizes, and Approval Rates Interpretation

While community banks approve about 70% of small business loans and fintech platforms boast a 75% approval rate for startups, microloans—though making up 35% of SBA loans and carrying higher interest—highlight the persistent challenge for small firms to secure larger, affordable funding, especially as the typical loan amount now hovers between $100,000 and $250,000, reflecting a landscape where established credit and innovative financing options often tip the scales away from traditional, straightforward bank loans.

Market Growth, Trends, and Technology Impact

Small businesses account for approximately 44% of U.S. economic activity
The online small business lending market grew by approximately 25% in 2022
The share of small business loans originating through online lenders increased from 12% in 2018 to 27% in 2022
Revenue-based financing is gaining popularity with about 10% of small business loan applications involving this method
The trend of ‘delegated lending’ where community lenders use third-party platforms increased by 15% in 2022
The number of small business loan applications processed digitally increased by 35% in 2022
The proportion of small business loans approved via peer-to-peer lending platforms increased from 8% in 2019 to 15% in 2022
The average duration for online lender approvals is around 24 hours, significantly faster than traditional bank approvals
The number of fintech startups offering small business loans increased by 45% between 2020 and 2023
The typical small business loan interest rate on online lending platforms is around 8%, with some offering rates as low as 5%
Growth in online and mobile banking has contributed to a 25% increase in small business loan applications processed digitally in 2022

Market Growth, Trends, and Technology Impact Interpretation

As small businesses increasingly harness digital and peer-to-peer lending, accounting for nearly half of U.S. economic activity, the swift rise of fintech and online platforms—up 45% since 2020—makes traditional bank approvals look like slow boats, proving that in the world of small business financing, speed and innovation are now the name of the game.

Sizes, and Approval Rates

The average small business loan size is around $585,000

Sizes, and Approval Rates Interpretation

With an average loan size of approximately $585,000, small businesses are clearly borrowing big, signaling their serious intentions to grow—so much for the small part.