From the Bridge • Capital Brief • May 14, 2026
Quick note up front. Everything in this article is for your education only. It is not financial advice. It is not legal advice. It is not investment advice. We are not financial advisors, lawyers, or investment professionals.
Last week, one of the top officials at the Federal Reserve walked onto a stage at Stanford University and said something most business owners in this country need to hear.
Since 2015, the bank share of corporate lending decreased from 48 percent to 29 percent.
Her name is Michelle Bowman. She is the person in charge of watching over the big banks in America. In plain English, here is what she said. Ten years ago, banks made about half the business loans in this country. Today, they make less than a third. The Federal Reserve published her speech the same day she gave it. So this is on the record.
Banks did not stop lending. They just lost ground. Somebody else stepped in. Somebody else is now writing the checks.
That somebody is called private credit. And the pile of money behind it just hit $2 trillion.
What does $2 trillion mean for you?
Two trillion dollars is a big number. Hard to picture. Try this. It is bigger than the entire economy of Spain. It is more than the federal government collects in income tax in a typical year. It is a wall of money looking for businesses to lend to.
The biggest credit ratings agency in the country, Moody’s, expects this market to double to $4 trillion by 2030. The United States holds the biggest piece of it.
This matters for one simple reason. Your bank is no longer the only place to get a business loan. Not even close.
Why did this happen?
After the 2008 crash, the government wrote new rules to keep banks safe. The rules made banks set aside more of their own cash for every loan they wrote. The intent was good. The result was that banks pulled back from lending to businesses, because the math stopped working for them.
When the banks pulled back, the money did not disappear. It moved. Pension funds, insurance companies, and investment firms set up their own lending shops. They saw a gap and walked through it. The Financial Stability Board, a group that watches global money flow, reported that the loans banks make to these new lending shops grew from about $8 billion in 2013 to about $95 billion at the end of 2024. That is twelve times bigger in eleven years.
Bowman herself called it a problem the regulators created without meaning to. The banks did not exit lending. They just changed jobs. Now they fund the lenders who do the lending.
The money is hunting your business. Your banker is the last person to tell you so.
What this means for your business
Three groups sorted by yearly revenue. Different options for each.
If your business does $50 million or more in yearly revenue.
You are right in the sweet spot for these non-bank lenders. Per PGIM, about 90 percent of these lenders focus on businesses your size. They will write you a loan in weeks instead of the three months a bank usually takes. The loan size they offer typically scales with your profit. As a rough rule, three to five times your yearly profit is on the table if your numbers are steady. The interest rate is competitive with what a bank would offer. The rules they put on the loan are usually lighter than your bank asks for, though they will still ask for at least one rule like keeping your debt level under a set line.
If your business does $10 million to $50 million in yearly revenue.
The big private credit lenders get harder to land at this size, but the field is filling in. There are lenders that loan against the stuff your business owns. Inventory, equipment, accounts receivable. JP Morgan and similar institutions write these loans starting around $5 million. Below that, online lenders cover smaller loans, usually under $5 million. The money is there. You just have to know where to look.
If your business is under $10 million in yearly revenue.
You are still mostly working with your local bank and the Small Business Administration. The SBA 7(a) loan is still the cheapest money you can borrow. It takes 60 to 90 days to close at most banks. Some banks have a faster track and can fund in 30 to 45 days. Worth asking your banker which one they are. As you grow past $10 million in revenue, the options open up. Start building those lender relationships now so you have them when you need them.
One thing to avoid no matter what size you run.
Merchant cash advances. The companies that pitch you fast cash in exchange for a slice of your future credit card sales. These look like loans but they are not. Per Nav and NerdWallet, the real cost of these advances usually lands between 60 percent and 300 percent a year. They are designed to keep you paying forever. Stay away unless you have already tried everything else.
What do these loans actually cost?
This part matters because the number on the page can fool you. Most of these non-bank lenders price their loans off a benchmark rate, kind of like how a mortgage tracks the 10-year Treasury. The benchmark sits around 3.25 percent right now.
On top of that base, the lender charges what is called a spread. Per Northleaf Capital’s research, spreads on these loans have dropped to between 4.5 and 5.5 percent in 2025. Add it up and the all-in interest rate on a good business loan from one of these non-bank lenders lands between 7.5 and 9 percent.
That is competitive with what your bank quotes you. In a lot of cases, it is cheaper. The reason you have not heard this is because your banker does not get paid to send your loan somewhere else.
PRO TIP
Before you sign your next loan, get one quote from your bank and one quote from a non-bank lender. Tell each one that you are talking to the other. Watch what happens. Most owners take the first piece of paper they see. That habit costs them real money they did not have to give up.
The risk side, honestly
This is not free money. There are real risks worth knowing.
These newer lenders are not watched as closely as banks. They do not have to report as much. In a downturn, problems will surface slower and be harder to spot in advance. The Federal Reserve has been quietly asking the big banks for more detail about their ties to these non-bank lenders since April. That tells you the regulators are starting to pay closer attention.
Treat these new lenders like serious money, because they are. Do the same homework on them you would do on any bank. Read the paperwork. Ask the hard questions. Call references.
Five moves to make this quarter
Get a second loan quote before you renew anything. Even if you love your bank. The point is to see what the market is actually willing to give you.
Clean up your books. The better your numbers look on paper, the better the rate any lender will give you. Every dollar of profit you make with clean records is worth more in cheaper borrowing.
If you plan to sell your business in the next three years, this changes what your business is worth. Buyers can now borrow money cheaper than they could five years ago. That means they can pay more for your business.
Send a monthly profit and loss report to a lender or two you might want to borrow from someday. Build the relationship before you need it.
Watch the cycle. Right now lenders are competing for good businesses to lend to. When the economy turns, they pull back fast. Get your relationship set up while the door is open.
Why this matters more than most Fed news
When a top Fed official admits in public that half the lending market left the banks in a decade, you are watching them admit something bigger. The Fed has lost some of its grip on how money flows to businesses.
The Fed funds rate, the number you see in every headline, matters less to your real borrowing cost than it did ten years ago. Half your borrowing options are now outside the banking system. What you actually pay for money depends on how good your numbers look and what the non-bank lenders are quoting today.
That is the bigger story. Watch the spreads, not just the headline rate. Know who lends in your size range. Always have two quotes in hand before you sign one.
The money is competing for your business. Make them prove it.
Stay on Course.
Alex Hays • Founder, Orion & Taurus • Fractional COO