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Last year, it tightened a requirement that businesses applying
for loans must be 100% owned by U.S. citizens, U.S. nationals,
or lawful permanent residents, up from a 51% standard.
In December, it issued a policy note that said up to 5% of a
business could be non-citizen owned. But the current policy
rescinds that, as well as making lawful permanent residents
ineligible, too.
“The Trump SBA is committed to driving economic growth and job
creation for American citizens – which is why, effective March
1, the agency will no longer guarantee loans for small
businesses owned by foreign nationals," said SBA spokesperson
Maggie Clemmons in an emailed statement. “Across every program,
the SBA is ensuring that every taxpayer dollar entrusted to this
agency goes to support U.S. job creators and innovators.”
The SBA doesn’t give out direct loans, except when they’re
related to disasters, but it works with lenders to distribute
loans to small businesses. The loans typically have better rates
than traditional loans.
Small business advocacy group the Small Business Majority said
the move is “a decision that will limit the growth of small
businesses and jobs throughout the United States.”
“The latest decision by SBA 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 that reality, SBA’s severe restrictions will have a
negative impact on small business creation throughout this
country for years to come.”
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