Small Business Funding Statistics (2026)
Application and approval rates for US small business financing, broken out by credit risk, firm size, revenue, industry, age and geography. Every number below comes from the Federal Reserve Banks' Small Business Credit Survey (2026 report, 2025 survey data) or the SBA — with direct source links.
The short answer
39% of US employer firms applied for new financing in the most recent Small Business Credit Survey, and 52% of applicants were approved for at least some of what they asked for. Approval is driven far more by credit risk and size than by industry: 60% of low-credit-risk firms were approved versus 30% of high-credit-risk firms, and 47% of firms with 1–4 employees versus 72% of firms with 50–499 employees. High-risk firms applied the most (62%) and were approved the least — which is exactly the gap revenue-based products such as merchant cash advances, working capital financing and invoice factoring are built to fill.
Approval rates by credit risk
| Segment | Applied for financing | Approved for at least some |
|---|---|---|
| Low credit risk | 40% | 60% |
| Medium credit risk | 52% | 32% |
| High credit risk | 62% | 30% |
Credit risk is the SBCS self-reported risk classification. The 30-point spread between low and high credit risk is the single largest driver of approval outcomes in the dataset.
Approval rates by firm size and revenue
| Segment | Applied for financing | Approved for at least some |
|---|---|---|
| 1–4 employees | 36% | 47% |
| 5–9 employees | 40% | 53% |
| 10–19 employees | 44% | 52% |
| 20–49 employees | 46% | 65% |
| 50–499 employees | 40% | 72% |
| Under $1M revenue | 38% | 45% |
| Over $1M revenue | 41% | 64% |
Approval rises monotonically with headcount and revenue. Firms under $1M in revenue are approved 19 points less often than firms above $1M.
Approval rates by industry
| Segment | Applied for financing | Approved for at least some |
|---|---|---|
| Manufacturing | 46% | 63% |
| Leisure & hospitality | 37% | 57% |
| Finance & insurance | 34% | 57% |
| Retail | 42% | 55% |
| Non-manufacturing goods production | 47% | 52% |
| Business support & consumer services | 35% | 52% |
| Professional services & real estate | 33% | 51% |
| Healthcare & education | 38% | 39% |
Healthcare and education fell from 51% to 39% year over year — the sharpest decline of any industry in the survey. Manufacturing improved the most, from 53% to 63%.
Approval rates by firm age and geography
| Segment | Applied for financing | Approved for at least some |
|---|---|---|
| 0–5 years in business | 46% | 48% |
| 6–15 years in business | 41% | 50% |
| 16+ years in business | 30% | 61% |
| Urban | 39% | 51% |
| Rural | 39% | 60% |
Younger firms apply more (46% at 0–5 years) and are approved less (48%). Rural firms were approved 9 points more often than urban firms.
Frequently asked questions
What percentage of small businesses get approved for funding?
In the Federal Reserve's 2025 Small Business Credit Survey (published March 2026), 52% of employer firms that applied for new financing were approved for at least some of the amount they sought. Approval rates ranged from 30% for high-credit-risk firms to 60% for low-credit-risk firms, and from 47% for firms with 1–4 employees to 72% for firms with 50–499 employees.
How many small businesses apply for financing each year?
39% of employer firms applied for new financing in the 2025 Small Business Credit Survey, up from 37% the prior year. Application rates are highest among younger firms (46% of firms 0–5 years old) and high-credit-risk firms (62%), and lowest among firms 16+ years old (30%).
Which industries have the hardest time getting approved?
Healthcare and education firms had the lowest approval rate at 39%, down from 51% a year earlier. Professional services and real estate followed at 51%. Manufacturing had the highest approval rate at 63%, then leisure and hospitality and finance and insurance at 57% each.
Do smaller businesses get approved less often?
Yes. Approval rates rise consistently with size: 47% for firms with 1–4 employees, 53% at 5–9 employees, 65% at 20–49 employees, and 72% at 50–499 employees. By revenue, firms under $1M were approved 45% of the time versus 64% for firms above $1M.
Why do high-credit-risk businesses apply more but get approved less?
High-credit-risk firms applied at 62% — the highest of any segment — because they more often face cash-flow gaps, yet only 30% were approved. That gap is why revenue-based products such as merchant cash advances, working capital advances and invoice factoring exist: they underwrite bank deposits and receivables rather than credit score alone.
Where does this data come from?
All figures come from the Federal Reserve Banks' Small Business Credit Survey — the 2026 Report on Employer Firms, published March 2026 with 2025 survey data — and the associated FRED release tables for 'Applied for New Financing' and 'Approved for New Financing'. Sources are linked at the bottom of this page.
Sources
- Federal Reserve Banks — 2026 Report on Employer Firms (2025 Small Business Credit Survey)
- FRED — Applied for New Financing (SBCS release tables)
- FRED — Approved for New Financing (SBCS release tables)
- U.S. Small Business Administration — Loan programs
Citation: Outset Funding Partners, "Small Business Funding Statistics (2026)", https://outsetfunding.com/reports/small-business-funding-statistics-2026. Figures are reproduced from public Federal Reserve and SBA data and are free to cite with attribution.
Where do you land in this data?
If your business is under $1M in revenue, under five years old, or would classify as medium or high credit risk, the survey says a bank is likely to decline you. Revenue-based funding underwrites your bank deposits instead — from 500 FICO, with offers in about 24 hours.
See what you qualify for