It’s back! The United States Small Business Administration (SBA) has announced the reinstatement of its Franchise Directory, reversing a decision made in 2023 under the previous administration. This reinstatement, effective June 1, 2025, marks a return to a system that simplifies the loan eligibility process for franchised businesses by providing a comprehensive list of brands that meet the SBA’s lending standards, expediting the review process.

In a Press Release from the International Franchise Association (IFA), Michael Layman, IFA Chief Advocacy Officer commented, “We applaud the SBA’s efforts to increase efficiency in the financing process for franchisees by restoring the Franchise Directory. As a centralized and verified location for lenders to check a franchise’s eligibility for SBA financing, the Franchise Directory was a key tool for lenders to efficiently process franchisee loan applications. Its elimination disrupted the development of franchised businesses, causing lenders to pull back from franchise lending, denying would-be entrepreneurs access to critical sources of start-up capital. IFA is proud of our work with the SBA team to reinstate this valuable resource to provide more franchisees the opportunity for small business ownership.”

What steps do you need to take? For brands that were on the SBA Franchise Directory as of May 11, 2023, the franchisor will need to submit the SBA’s Franchisor Certification, which is a one-time acknowledgment that the brand is eligible for inclusion on the SBA Franchise Directory under the SBA Loan Program Requirements, meets the FTC’s definition of a Franchise, and the franchise documents do not otherwise prohibit inclusion on the Directory. Once the SBA updates the SBA Franchise Directory to indicate that the franchisor has provided the Franchisor Certification, the franchisor is no longer required to use a separate addendum for each loan a franchisee obtains through the SBA (i.e. Form 2462 or a negotiated addendum). The Franchisor Certification must be submitted to the SBA via email prior to July 31, 2025, or the brand will be removed from the SBA Franchise Directory.

For brands that were not previously included on the SBA Franchise Directory, they will need to ensure that their documents include the SBA-required language and submit the FDD and franchise agreement, as well as the Franchisor Certification to the SBA for review to ensure that the brand is eligible for inclusion. Once approved, the brand will be added to the SBA Franchise Directory and provided with an SBA Franchise Identifier Code. There is no cost for a Franchisor to be listed on the SBA Franchise Directory.

Spadea Lignana is working with our clients to ensure their inclusion on the SBA Franchise Directory. Please reach out to your attorney with any questions you may have..