NEW YORK (AP) — Green card holders will not be able to apply for SBA loans starting March 1, the Small Business Administration said in a policy note.
It’s the latest step in the SBA’s efforts to tighten lending restrictions and restructure the agency.
Last year, it tightened the requirement that businesses applying for loans must be 100% owned by U.S. citizens, U.S. nationals or lawful permanent residents, above the 51% standard.
In December, it issued a policy note saying that up to 5% of companies could be owned by non-citizens. But the current policy abolishes this and also disqualifies legal permanent residents.
“The Trump SBA is committed to driving economic growth and creating jobs for American citizens, which is why, effective March 1, the agency will no longer guarantee loans to foreign-owned small businesses,” SBA spokesperson Maggie Clemmons said in an emailed statement. “In every program, the SBA ensures that every taxpayer dollar entrusted to the agency is used to support America’s job creators and innovators.”
The SBA does not provide direct loans unless related to a disaster, but it works with lenders to issue loans to small businesses. These loans typically have better interest rates than traditional loans.
Small business advocacy group Small Business Majority said the move “will limit the growth of small businesses and jobs across the United States.”
“The SBA’s latest decision fails to recognize that immigrants are twice as likely to start a business as native-born U.S. citizens,” said Small Business Majority CEO John Arensmeyer. “Given this reality, the SBA’s stringent restrictions will negatively impact the creation of small businesses across the country for years to come.”
