The U.S. Small Business Administration created the SBA Franchise Directory to try and streamline the process for entrepreneurs looking to access capital.
According to SBA Associate Administrator Willam Manger, “It’s a one stop shop to check the growing list of eligible brands for SBA financing. Since its establishment, the Directory and new procedures have received extremely positive feedback from the stakeholders participating in the process.”
Under SBA SOP 50 10 5(J) inclusion in the Directory is now mandatory for any FTC defined franchise seeking to use SBA lending programs. The eligibility status of the franchise brands on this list are checked and cleared by the SBA cutting the finance processing time and making it more efficient. Once franchisors have filed the proper paperwork, lenders can process loans without further review of the franchise documents. The vast majority of new brands are reviewed within 14-21 days.
According to the SBA, potential franchises interested in being listed on the Directory should email copies of their Franchise Disclosure Document, the Franchise Agreement (or license or other type of agreement), and any other documents that the franchisor will require the franchisee to execute to franchise@sba.gov(link sends e-mail). There are no fees for franchises that want to be added to the Directory and it is accessible to everyone visiting SBA’s website (www.sba.gov).
