Alternative Lending on the Rise for U.S. Small Businesses

Alternative lending options are on the rise for both small (<$5 million in revenue) and mid-sized ($5 - $100 million) businesses, according to results from the Q2 Private Capital Access Index(PCA Index) from Dun & Bradstreet and Pepperdine Graziadio Business School. Thirty-four percent (34%) of respondents attempted to raise financing in the last quarter, up from 29% reported in Q1. Attempts to secure a loan from a traditional bank has declined since Q1, however, with 41% of businesses reporting that they sought a bank loan as a source of funding compared to 49% the previous quarter. Bank loan success rates are also down for both small and mid-sized businesses, with 32% of small businesses (down from 41% the previous quarter) and 89% of mid-sized businesses (down from 95% the previous quarter) reporting success rates for bank loans.