Well.....It would eliminate the insurgence of many clans into LoB. There's pro's and con's to it also:
Pro's:
1. Eliminates too many clans
2. Squad wars would be easier to manufacture (although it's still a waste in my opinion).
3. Since everyone is a shingami, the only choices are to either join a squad or not join one at all and consider yourself a rouge shingami (free agent/lone wolf).
4. Since arrancars and vizards won't be implemented for a long time, the most important thing is to build your skills as an shingami and represent your squad with your abilities.
Con's:
1. There's already been a discussion of how much clans will cost (ie, 100 gems) which will limit clans.
2. Is is fair to truly limit the number of clans? I mean is 20 too many? Say we have 13 and someone wants to form a clan called Bounts, should he/she be denied?
3. As with Shinobi Legends, you may have a founder of a squad that wants to promote their friends or loyal/trusted backers to higher positions instead of the second most powerful (which brings up issues with clan destroyers, which no one wants to discuss cause it's a pain.)
4. It limits creativity, I agree that SL has a vast amount of clans, but some of the clans with the most members are not Naruto-based clans. The founder creatively came up with a name and people joined, limiting the clans to only squads would limit creativity and everyone would want to be leader of a few selected squads.