FranNet: Loan Approval Rise Shows Start of Small Business Recovery

FranNet: Loan Approval Rise Shows Start of Small Business Recovery

Small Bank Approval Rate Jumps 5 Points in Last Year, Big Bank Rate 2 Points

LOUISVILLE, KY--(Marketwire - Jul 17, 2012) - Since the near-collapse of the world economy four years ago, tight credit markets have stunted small business growth by shutting entrepreneurs off from startup capital. But credit markets are beginning to loosen.

The Biz2Credit Small Business Lending Index, a monthly analysis of 1,000 loan applications by International Franchise Association member, found that loan approval rates from big banks jumped a half a percentage point from May (10.6 percent) to June (11.1 percent). The increase also represents a more than 2 percent jump from June 2011, when the approval rate was a dismal 8.9 percent.

The loan approval rate from small banks rose as well, from 45.5 percent in May to 47.5 percent in June -- a full five points higher than the 42.5 percent rate in May 2011.

The franchise experts at FranNet, an international network of franchise consultants, welcomed the news as further evidence of an improving economy with more opportunities for entrepreneurs.

"This year, we've already seen some of our clients finance their initial franchise investments through unsecured loans -- something we hadn't encountered since 2008 -- and leveraging their retirement funds tax-free to pay for their initial investments," said Jania Bailey, FranNet president and chief operating officer. "We certainly welcome the higher approval rates. The more entrepreneurs have access to startup capital, the more jobs they create and the more local economies thrive."

Franchising is one of the few sectors of the national economy that has added jobs during the recession. The IFA predicts the industry will add 14,000 new units and contribute 168,000 new jobs to the U.S. economy this year, and each new franchise unit adds an estimated 10 new jobs to the economy. "If credit markets continue to relax," Bailey said, "those numbers may end up being too conservative."

About FranNet

FranNet, headquartered in Louisville, Ky., is a private franchised business consulting company that for 25 years has helped professionals open their own franchise businesses. FranNet consultants work individually with clients and use a specific profiling and consultative process to determine a business model unique to each person. Its services are free. For more information, visit

Media Contact:

John Blair
(502) 753-2380, ext. 227



comments powered by Disqus

Franchise News Room »

News By Industry »

Featured Opportunities

Pancheros Mexican Grill
Panchero's is a quick-serve, fresh-Mexican franchise founded in 1992, famous for serving tortillas pressed fresh right before its customers' eyes...
Blink Fitness
At Blink Fitness, exercise isn't just about looking good, it's also about how it makes you feel.
Sky Zone
Sky Zone created, built and franchises the first of its kind wall-to-wall trampoline playing courts with unlimited purposes and endless possibilities.
ZIPS Dry Cleaners
ZIPS, since 1996, began as eight dry cleaners in the Baltimore-Washington, D.C., metro area and has grown to more than 40 stores. Find out more.
Big Blue Swim School
Big Blue Swim School focuses on creating Big Moments for children ages six months to 12 years old.
Share This Page

Subscribe to Franchising Express

A Franchise Update Media Production
Franchise Update Media
P.O. Box 20547
San Jose, CA 95160
PH. (408) 402-5681
In Loving Memory Of Timothy Gardner (1987-2014)

Copyright © 2001 - 2018.
All Rights Reserved.