Fintech and Online Lender Applications Climbed for Five Straight Survey Years
The share of small business financing applicants who sought credit from online or fintech lenders rose from 17% in the Federal Reserve’s 2020 Small Business Credit Survey to 29% in its 2025 survey, an increase running for the fifth consecutive survey year, according to America’s SBDC’s summary of the Fed’s 2026 Report on Employer Firms. That climb was independently corroborated, without restating the exact percentages, by Fed Communities’ own key-insights summary of the same 2025 survey, which confirms the share applying at online lenders increased for the fifth consecutive survey year.
The 2025 survey was fielded September through November 2025 among more than 6,500 small employer firms, with the full report published March 3, 2026. Large banks remained the single most-applied-to financing source overall across that same survey, meaning a rising fintech-application share has not yet displaced banks as the first place most small businesses apply, even as it has climbed steadily for half a decade.
Large Banks Still Lead, But Their Own Application Share Slipped
A separate cut of the same Fed survey program, fielded September 4 through November 4, 2024 among 7,653 responses from firms with 1 to 499 employees, found the large-bank application rate falling from 44% in the 2023 survey to 39% in 2024, a 5 percentage point year-over-year decline, per Fed Communities’ own key-insights summary of the 2024 Small Business Credit Survey. Application rates at small banks, online lenders, finance companies, and credit unions mostly held steady over that same year, meaning the large-bank drop did not correspond to a matching spike at any single alternative channel that year.
Application Share Versus Actual Lending Volume
Both figures above are application-share statistics, the demand-side record of where a business submitted a financing request. Loan-origination or dollar-volume market share is a separate, supply-side measure of how much financing nonbank and fintech lenders fund, and it is not what either figure here tracks. A rising fintech-application share is genuine evidence that more small businesses are including a fintech lender in their search, but it is not the same claim as “fintech lenders now originate X% of small-business loans,” a distinct statistic this research did not locate.
Who Answers This Survey, and How Often
The Federal Reserve Small Business Credit Survey runs annually across the twelve regional Federal Reserve Banks, fielding responses from thousands of small employer firms each cycle, more than 6,500 for the 2025 survey and 7,653 for the 2024 survey. That annual cadence is what makes a five-consecutive-survey-year trend, rather than a single-year snapshot, possible to state with real confidence.
What a Five-Year Climb in Fintech Applications Signals for Alternative Funders
A small business that has already applied to an online or fintech lender has already crossed a mental threshold most bank-only applicants have not: it has actively considered a financing source outside the traditional branch relationship. A rising application share across the same five survey years this piece cites suggests a growing pool of businesses arriving at that same threshold every year, relevant context for any funder or broker whose own pitch depends on a prospect being open to a non-bank conversation in the first place.
Human + AI SDRs qualify prospects over SMS as that willingness shows up, rather than assuming every prospect still needs to be talked into considering a nonbank financing conversation from scratch.
The Numbers
The share of small business financing applicants applying to online or fintech lenders rose from 17% (2020 survey) to 29% (2025 survey), the fifth consecutive survey year of increase.
Large banks remained the single most-applied-to financing source overall in the 2025 Small Business Credit Survey, fielded September to November 2025 among 6,500+ small employer firms.
Fed Communities, Key insights from the 2025 Small Business Credit Survey
The large-bank application rate fell from 44% (2023 survey) to 39% (2024 survey), a 5 percentage point year-over-year decline, while small banks, online lenders, finance companies, and credit unions mostly held steady.
Fed Communities, Key insights from the 2024 Small Business Credit Survey
Sources
The external data in this article draws on the sources below. Figures described in the text as estimates or industry triangulations are directional and are not attributed to a single dataset.
- America’s SBDC, summary of the Federal Reserve 2026 Report on Employer Firms (2025 Small Business Credit Survey)
- Fed Communities, Key insights from the 2025 Small Business Credit Survey
- Fed Communities, Key insights from the 2024 Small Business Credit Survey