In the wake of the severe economic downturn, the IFA began calling on the
federal government to take action that would ease frozen credit markets. At
every opportunity, the IFA has delivered a fundamental message that in times of
economic stress, franchising gives small businesses an extra margin of help
through access to training, business methods and marketing support provided by
the franchisor. Franchising offers the U.S. economy a strong foundation from
which to encourage job growth and recovery. Providing franchised businesses
access to capital by improving operation of secondary markets will ensure that
small business entrepreneurs are positioned to help spur economic growth.
Franchising thrives when capital flows freely from commercial and SBA
government-guaranteed lenders to qualified franchise borrowers. For every $1
million in lending to a franchise, 40 new direct and indirect jobs are created,
generating $4.2 million in economic output. IFA supports maintaining current
funding levels for the 7(a) and 504 loan programs, given franchises are
responsible for 7 percent of total SBA loan dollars and 11 percent of SBA loan
The Small Business Administration's (SBA) 7(a) General Business Loan
Guaranty Program is the SBA's largest and most important program, in terms of
number of loans and program level supported. The program operates through
private-sector lenders that provide loans that are then guaranteed by the SBA,
which has no funds for direct lending or grants.
For more information contact Jay Perron, Vice President of
Government Relations and Public Policy, at email@example.com or (202) 662-0797.