Banks were the primary source credit among employer businesses that did apply for new credit — and they became even more dominant over time. In 2023, 73.1% of employer businesses sought new credit from a bank, up from 67.2% in 2020.
Finance companies were the second most common source of new credit — 22.8% of employer businesses seeking credit in 2023 turned to them, up from 18.0% in 2020.
“Other sources” included basically any lender besides banks, credit unions, fintech (online lenders that automate underwriting and digital loan delivery), finance companies and community development financial institutions. They were the second most common option in 2020 (19.1%) but by 2023 had slipped to a 9.3% share of employer business credit applicants.
It’s important to note these percentages do not add up to 100% because an employer business may apply to more than one source of new credit.