Nine Percent of Small Businesses Applied for Credit at CUs

According to the Federal Reserve's 2017 Small Business Credit Survey, banks are the most common source that small businesses apply to for credit.

Only 9 percent of small businesses reported applying for credit at credit unions.

Ten percent of medium to high credit risk firms applied for credit from credit unions versus 8 percent of firms with low credit risk.

Credit unions had the lowest approval rate of loan/line of credit and cash advances at 53 percent. The approval rate at credit unions was 76 percent for low credit risk firms versus 26 percent for medium to high credit risk businesses.

The survey found that community development financial institutions, credit unions, and small banks had the highest net satisfaction rate from small business borrowers. Community development financial institutions rated the highest at 76 percent. Small banks and credit unions had net satisfaction ratings of 73 and 74 percent, respectively.

Percentage of small business nonapplicants with debt from credit unions was 8 percent. However, nonapplicants with debt gave credit unions the highest net satisfaction ranking at 81 percent.

The survey noted that applications to online lenders increased to 24 percent in 2017 from 21 percent in 2016.

View the survey report.