SBA says legal permanent residents will be ineligible for its loan program, effective March 1
NEW YORK (AP) — Starting March 1, green card holders will not be allowed to apply for SBA loans, the Small Business Administration said in a policy memo.
This move is the latest move by the SBA, which is trying to tighten loan restrictions and restructure the agency.
Last year, it tightened the requirement that 100% of businesses applying for loans must be owned by U.S. citizens, U.S. citizens or lawful permanent residents from the 51% standard.
In December, it issued a policy brief stating that no more than 5% of a business can be owned by citizens. But in addition to repealing this, the current policy also disenfranchises legal permanent residents.
“The Trump SBA is committed to supporting economic growth and job creation for American citizens, so beginning March 1, the agency will no longer guarantee loans to small businesses owned by foreign nationals,” SBA spokeswoman Maggie Clemmons said in an emailed statement. “In every program, SBA ensures that every taxpayer dollar entrusted to this agency goes to support job creators and innovators in the United States.”
The SBA does not provide loans directly except when related to disasters, but it works with lenders to distribute loans to small businesses. The loans often have better rates than traditional loans.
The small business advocacy group Small Business Majority said the move was “a decision that will limit the growth of small businesses and jobs in the United States.”
“The SBA’s latest decision ignores that immigrants are twice as likely to start businesses as U.S.-born citizens,” said John Arensmeyer, CEO of Small Business Majority. “Given this reality, the SBA’s severe restrictions will have a negative impact on small business formation across this country for years to come.”
