Among the key statistics illustrating the unfulfilled demand for small business loans, the source points out that micro businesses — businesses with revenues of less than USD 250,000 — were rejected from receiving a loan a majority of the time in H1 2014, according to an updated report from the New York Fed. And only 25% of micro businesses received the entire loan amount they applied for.
The source also highlights that half of small businesses were also rejected, with just over a third receiving the full requested amount. Furthermore, unfulfilled demand for loans is most concentrated among these two segments. A large majority of mid-size and commercial businesses receive all the credit they apply for.
Finally, the source reveals that alternative lenders are swooping in to fill this gap between loan demand and supply, approving loans at a much higher rate than large banks. Alternative lenders approved 61% of small business loans in February 2015, compared to 22% among big banks, the Biz2Credit Small Business Lending Index shows.
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