GITNUXREPORT 2025

Small Business Loan Statistics

Small businesses face significant funding challenges; online lenders grow rapidly.

Jannik Lindner

Jannik Linder

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

First published: April 29, 2025

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Key Statistics

Statistic 1

The failure rate of small businesses within the first five years is approximately 50%, with access to capital being a contributing factor

Statistic 2

Approximately 60% of small businesses that receive loans experience growth within two years

Statistic 3

Over 70% of small business owners who receive funding report that it has helped stabilize or expand their operations

Statistic 4

Approximately 40% of small business owners use personal savings to fund their business

Statistic 5

About 70% of small business owners seek external financing

Statistic 6

Microloans (loans under $50,000) comprise nearly 60% of all small business loans

Statistic 7

Approximately 30% of small businesses that seek funding turn to online lenders

Statistic 8

Nearly 75% of new small businesses rely on some form of debt financing within their first year

Statistic 9

Only about 20% of small business owners apply for government-backed loans like the SBA loan

Statistic 10

Entrepreneurs report that access to affordable financing is the top challenge faced, cited by 55% of small business owners

Statistic 11

The share of small business loans approved through online lenders has increased by over 45% since 2020

Statistic 12

In 2023, total small business loan volume in the US exceeded $700 billion

Statistic 13

More than 50% of small business owners are concerned about their ability to secure future financing

Statistic 14

The majority of small business loans are secured loans, comprising about 80% of all small business lending

Statistic 15

Startups are twice as likely to rely on personal borrowing as established businesses when seeking funding

Statistic 16

Over 65% of small business owners consider access to capital as a primary barrier to growth

Statistic 17

The share of small businesses using crowdfunding for funding is growing at approximately 12% annually

Statistic 18

Approximately 15% of small business owners report that they have taken out a loan in the past year

Statistic 19

The use of SBA 7(a) loans accounts for about 60% of all SBA-backed small business loans

Statistic 20

Small business loan demand tends to increase during economic downturns as businesses seek liquidity

Statistic 21

The median small business loan size in the US is around $13,000

Statistic 22

The approval rate for small business loans at traditional banks is approximately 20-30%

Statistic 23

The average interest rate for small business loans from traditional banks is around 6-8%

Statistic 24

The most common terms for small business loans are 5-10 years

Statistic 25

The average size of a small business loan approved in 2023 was $68,000

Statistic 26

Small business loan rejection rates tend to be higher for startups (around 70%) compared to established firms (around 50%)

Statistic 27

The percentage of small businesses that successfully obtain a loan varies significantly by industry, with manufacturing and healthcare having the highest approval rates

Statistic 28

The debt-to-equity ratio for small business loans averages around 2.5, indicating moderate leverage

Statistic 29

The average credit score of small businesses approved for loans is approximately 670

Statistic 30

Small businesses in rural areas are 30% less likely to secure bank loans compared to urban counterparts

Statistic 31

Less than 10% of small business loans are used for real estate investment, according to recent surveys

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Small businesses represent 99.9% of all United States businesses

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Women-owned small businesses are 20% more likely to use microloans compared to their male counterparts

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Businesses in the retail sector constitute roughly 45% of all small business loan recipients

Statistic 35

Less than 20% of women-owned small businesses have access to traditional bank loans, indicating a funding gap

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Key Highlights

  • Small businesses represent 99.9% of all United States businesses
  • Approximately 40% of small business owners use personal savings to fund their business
  • The median small business loan size in the US is around $13,000
  • About 70% of small business owners seek external financing
  • The approval rate for small business loans at traditional banks is approximately 20-30%
  • Microloans (loans under $50,000) comprise nearly 60% of all small business loans
  • Approximately 30% of small businesses that seek funding turn to online lenders
  • The average interest rate for small business loans from traditional banks is around 6-8%
  • Nearly 75% of new small businesses rely on some form of debt financing within their first year
  • The most common terms for small business loans are 5-10 years
  • Only about 20% of small business owners apply for government-backed loans like the SBA loan
  • The failure rate of small businesses within the first five years is approximately 50%, with access to capital being a contributing factor
  • Entrepreneurs report that access to affordable financing is the top challenge faced, cited by 55% of small business owners

Did you know that while small businesses make up 99.9% of all U.S. companies, securing funding remains a daunting challenge—with only 20-30% of traditional bank loan applications approved—yet over $700 billion was lent to small businesses in 2023 alone?

Business Success Rates and Challenges

  • The failure rate of small businesses within the first five years is approximately 50%, with access to capital being a contributing factor
  • Approximately 60% of small businesses that receive loans experience growth within two years
  • Over 70% of small business owners who receive funding report that it has helped stabilize or expand their operations

Business Success Rates and Challenges Interpretation

While half of small businesses falter within five years, those that secure funding are more likely to flourish—suggesting that access to capital isn’t just a boost but often the vital lifeline that transforms a gamble into growth.

Funding Sources and Loan Types

  • Approximately 40% of small business owners use personal savings to fund their business
  • About 70% of small business owners seek external financing
  • Microloans (loans under $50,000) comprise nearly 60% of all small business loans
  • Approximately 30% of small businesses that seek funding turn to online lenders
  • Nearly 75% of new small businesses rely on some form of debt financing within their first year
  • Only about 20% of small business owners apply for government-backed loans like the SBA loan
  • Entrepreneurs report that access to affordable financing is the top challenge faced, cited by 55% of small business owners
  • The share of small business loans approved through online lenders has increased by over 45% since 2020
  • In 2023, total small business loan volume in the US exceeded $700 billion
  • More than 50% of small business owners are concerned about their ability to secure future financing
  • The majority of small business loans are secured loans, comprising about 80% of all small business lending
  • Startups are twice as likely to rely on personal borrowing as established businesses when seeking funding
  • Over 65% of small business owners consider access to capital as a primary barrier to growth
  • The share of small businesses using crowdfunding for funding is growing at approximately 12% annually
  • Approximately 15% of small business owners report that they have taken out a loan in the past year
  • The use of SBA 7(a) loans accounts for about 60% of all SBA-backed small business loans
  • Small business loan demand tends to increase during economic downturns as businesses seek liquidity

Funding Sources and Loan Types Interpretation

Despite a heavy reliance on personal savings and debt, over half of small business owners find accessing affordable, timely financing—especially from online lenders and microloans—challenging enough to threaten their growth and sustainability amidst record-high lending volumes exceeding $700 billion annually.

Loan Metrics and Approval Rates

  • The median small business loan size in the US is around $13,000
  • The approval rate for small business loans at traditional banks is approximately 20-30%
  • The average interest rate for small business loans from traditional banks is around 6-8%
  • The most common terms for small business loans are 5-10 years
  • The average size of a small business loan approved in 2023 was $68,000
  • Small business loan rejection rates tend to be higher for startups (around 70%) compared to established firms (around 50%)
  • The percentage of small businesses that successfully obtain a loan varies significantly by industry, with manufacturing and healthcare having the highest approval rates
  • The debt-to-equity ratio for small business loans averages around 2.5, indicating moderate leverage
  • The average credit score of small businesses approved for loans is approximately 670
  • Small businesses in rural areas are 30% less likely to secure bank loans compared to urban counterparts

Loan Metrics and Approval Rates Interpretation

While small business loans in the U.S. often start small and face tough approval odds—especially for startups and rural entrepreneurs—the relatively modest interest rates and longer terms can make borrowing a necessary if formidable tool for growth.

Loan Usage and Application Trends

  • Less than 10% of small business loans are used for real estate investment, according to recent surveys

Loan Usage and Application Trends Interpretation

Despite the daunting headlines about real estate's allure, less than 10% of small business loans are channeled into property investment, indicating entrepreneurs are more focused on fueling their core operations than building empires on bricks and mortar.

Small Business Demographics and Ownership

  • Small businesses represent 99.9% of all United States businesses
  • Women-owned small businesses are 20% more likely to use microloans compared to their male counterparts
  • Businesses in the retail sector constitute roughly 45% of all small business loan recipients
  • Less than 20% of women-owned small businesses have access to traditional bank loans, indicating a funding gap

Small Business Demographics and Ownership Interpretation

Despite comprising nearly all U.S. businesses, small enterprises—particularly women-led ones—face a financing paradox: while retail dominates loan recipients, a significant funding gap for women persists, highlighting the urgent need for more inclusive lending solutions.