FOR IMMEDIATE RELEASE
Contact:
Jenna Weisbord, 310-995-0839
jweisbord@franchise.org
@franchising411
IFA APPLAUDS SBA FOR REVISING FRANCHISE REVIEW PROCESS
WASHINGTON, Feb. 15, 2017 – International Franchise Association President and CEO Robert Cresanti released the following statement applauding the Small Business Administration’s (SBA) announcement that it is temporarily revising the new procedures governing lending to franchise businesses, a victory for small business owners who rely on SBA lending programs to access capital to open new franchises. The revisions are a result of IFA advocating directly with current and former administration officials regarding concerns with the revised procedures released late last year.
“The IFA is pleased the SBA listened to the concerns expressed by franchisors and franchisees about the new lending process and decided to accommodate those views. Most recently, IFA members raised these issues at the IFA’s annual convention in Las Vegas during roundtables featuring SBA staff. At those roundtables, several franchisors asserted they would be unable to comply with the new rules and could not sign the new required addendum, which would have seriously curtailed SBA backed lending to franchise businesses. The attendees asked the SBA why they could not continue using their current SBA-approved addendums?
“With SBA’s announcement that it will allow franchisors to either certify that they are using previously approved 2015 and 2016 SBA addendum or sign the new addendum released in December 2016, the SBA is demonstrating it listened to the small franchise businesses it serves and is alleviating some of the unintended negative consequences of the new procedures.
“The IFA is pleased the SBA is adopting this common sense approach, and we look forward to working with the SBA to ensure franchise businesses’ access to credit continues unimpeded.”
In 2016 alone, SBA backed loans to franchise businesses totaled $770 million and were used in the financing of over 5,500 franchise businesses. Franchise businesses are local businesses that provide $404 billion in economic activity in communities across the country. And, for every $1 million in lending franchises, an estimated 40 new direct and indirect jobs are created. Ensuring lending to franchise businesses is facilitated is critical to the IFA.
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About the International Franchise Association
Celebrating 56 years of excellence, education and advocacy, the International Franchise Association is the world’s oldest and largest organization representing franchising worldwide. IFA works through its government relations and public policy, media relations and educational programs to protect, enhance and promote franchising and the more than 733,000 franchise establishments that support nearly 7.6 million direct jobs, $674.3 billion of economic output for the U.S. economy and 2.5 percent of the Gross Domestic Product (GDP). IFA members include franchise companies in over 300 different business format categories, individual franchisees and companies that support the industry in marketing, law, technology and business development.
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