by Heather Bosenko

Highlights from 2019 Federal Reserve Small Business Credit Survey

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Commercial loans can be one of the most profitable products in a loan portfolio, but many wonder if there’s enough demand to justify diving in. The short answer is YES! 

Figure 1. Source: 2019 Small Business Credit Survey

Each year the Federal Reserve conducts a Small Business Credit Survey (SBCS) to provide insights on the dynamics behind lending trends and shed light on noteworthy segments of the small business population. The latest survey results indicate a strong opportunity for community lenders to step in and fulfill small business loan needs. 

The survey examined businesses with 1–499 full- or part-time employees and showed these businesses have a consistent demand for new financing. 43% of those surveyed had applied for new capital in the prior 12 months, in line with 40% in the year prior.1

The reasons for applying ranged in purpose with a whopping 56% of applicants looking to expand business, pursue new opportunities, or acquire business assets.2 That's a considerable amount of potential business loans. Other applicants were looking for opportunities to meet operating expenses, refinance existing debt, replace capital assets or make repairs.  

Businesses applying for credit typically weren’t looking for enormous sums of money either. In fact, 57% of the financing sought was for amounts less than $100,000.3 Community lenders interested in funding small to medium-sized loans for small businesses have a big opportunity here. 

Figure 2. Source: 2019 Small Business Credit Survey

With consumers focused heavily on convenience, online lending has experienced the most significant growth. This presents a substantial opportunity for community lenders to begin investing.

Our Digital Business Lending Center was designed specifically with convenience in mind. We simplify the application process and can help get online business loan approvals in minutes, not weeks.

Let Lucro help you take advantage of the growing trend in small business lending with our new Digital Business Lending Center.

1,2,3 Federal Reserve Banks of Atlanta, Boston, Chicago, Cleveland, Dallas, Kansas City, Minneapolis, New York, Philadelphia, Richmond, St. Louis, and San Francisco (2019). Small Business Credit Survey. Retrieved from: