Here’s what we found.
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Most approved applicants reported personal credit scores of 700 or higher, though one in five still secured funding with scores below 660. ( link )
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While higher-revenue businesses were approved more often and for larger amounts, 22% of approved borrowers reported earning less than $500,000 a year. ( link )
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The median time in business among approved borrowers was seven years, but one in four had been operating for four years or less. ( link )
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General contractors, restaurants and bars and health services made up the largest share of approvals. ( link )
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Sixty-five percent of approved borrowers sought funding for working capital. ( link )
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Short-term loans dominated approvals, but SBA and medium-term loans delivered higher amounts. ( link )
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On average, small-business owners received 75% of the amount they requested. ( link )
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Strong credit scores remain a major advantage
More than half (55%) of approved applicants reported personal credit scores of 700 or higher. Higher scores were also linked to larger loan amounts, according to the data.
Lenders use credit scores to gauge how likely you are to repay a loan. Generally, the higher your score, the less risky you look. This can open the door to bigger loans, better terms and lower interest rates.
But you’re not out of options if you have fair or even bad credit. Our data found that borrowers with credit scores of 659 or below made up 20% of approved applications. Of those approved applicants, 80% reported at least $500,000 in annual revenue, and 71% had been in business for five years or more. This suggests that a bad credit score can be offset by strengths in other areas of your business.
Action steps:
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Improve your credit score by paying bills on time, disputing credit report errors or becoming an authorized user on someone else’s credit card account.
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Boost loan approval odds by adding a co-signer or offering additional collateral.
High-revenue businesses get approved more often, but low revenue isn’t a dealbreaker
Nearly a quarter of approved businesses (22%) reported earning less than $500,000 a year in revenue. While higher-revenue businesses get approved for loans more often (and for more money), our data shows that if you make at least $100,000 a year, you’ve still got options.
Strong and consistent revenue tells lenders that your business is stable and has the cash flow to handle repayments. That’s why many lenders require at least $100,000 in annual income, but online lenders may be more flexible.
Action steps:
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Be upfront with lenders if your business is going through a rough patch, says Manny Tocco, head of sales for business banking at Citizens. Being transparent and showing how you’re addressing revenue challenges builds trust and can boost your chances of getting approved, Tocco said.
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If you aren’t submitting your application right away, explore near-term ways to improve income, like increasing sales, improving customer retention or adding complementary products or services.Â
While time in business matters, many newer businesses still get approved
Older businesses tended to receive larger loan amounts on average, but our data shows that newer companies can still qualify for funding. For example, NerdWallet found that one in four approved borrowers reported being in business for four years or less.
New businesses may be able to boost approval odds by having a strong credit score or high annual revenue. For example, 78% of approved borrowers operating for four years or less reported having a personal credit score of 660 or higher.
Action steps:
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If you have assets on hand, like inventory or savings, consider using them as collateral.
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Reach out to your local Small Business Development Center for one-on-one guidance on starting a business, applying for financing and more.
Lenders favor businesses with stable demand, growth potential and collateral
Across all approved loans, the largest share went to:
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General contractors.
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Health services (e.g., health practitioner offices and outpatient care centers).
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Restaurants, cafes and bar-lounges.
And, the industries with the highest average loan amounts were:
These industries tend to have stable customer demand, high growth potential, collateral on hand or a combination of all three. These factors help lenders feel better about extending financing.
Action steps:
Most borrowers seek working capital
Among approved business owners, 65% said they were seeking funding to cover working capital needs.
Other top reasons for applying included business expansion and buying equipment, according to our data.
Action steps:
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Build a cash reserve so you’re not scrambling to find financing or dipping into personal savings every time your business hits a bump in the road. Shoot for at least six months’ worth of operating expenses, recommends Helen Dao, certified financial planner and senior vice president of investments at Stirlingshire Investments.
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Consider opening a business line of credit before you need it, Dao said. Having one provides flexibility in case misfortune strikes your business or the economy. Because by that time, getting approved for new financing may be much harder.
Short-term loans dominate approvals, but SBA and medium-term loans deliver the biggest amounts
Short-term loans were the most commonly approved type of financing, followed by short-term lines of credit and merchant cash advances.
But because they’re usually repaid within 12 months, total interest costs may end up being smaller than a longer term loan with a lower rate.
When it comes to average loan size, medium-term loans (with two- to five-year repayment terms) and SBA loans led the way. These are harder to qualify for, but their longer repayment terms and lower interest rates make them a good choice for bigger, long-term investments.
Action step:
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Match your needs to the right loan type. For example, if you’re looking for money to fuel long-term growth, a larger loan from a bank or SBA lender may be best. If you need cash quickly to cover an unexpected repair and don’t already have a business line of credit with a bank or SBA lender, online loans may be the best choice.
Borrowers receive 75% of what they asked for, on average
Across approved borrowers, the typical business received three-quarters of what they originally requested.
This can happen for a few reasons. Borrowers may overestimate how much they need. Other times, the lender isn’t willing to give the full amount, either due to loan caps or because the applicant’s qualifications makes full approval too risky.
Action steps:
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Get a good idea of exactly how much you need and what you can realistically qualify for. Working with a professional, like a business loan broker, can help. You may also be able to access free advice through your local Small Business Development Center (SBDC).
This study analyzes loan application data from small-business owners approved for financing through Fundera by NerdWallet’s loans marketplace between July 2024 and June 2025. Applicants self-reported data for personal credit scores, business revenue, business start dates, funding purposes, industry information and loan amount requested. We also analyzed the actual amount applicants received and the type of business loan borrowers ended up with.
