By Megan Cerullo
Updated on: February 3, 2026 / CBS News
The Small Business Administration is barring green card holders and other non-U.S. citizens from applying for loans under its main lending program.
Starting March 1, only U.S. citizens or U.S. nationals who have their principal residence in the United States or its territories will be eligible for the SBA’s 7(a) program. The agency said in a policy notice that “100% of all direct and/or indirect owners of a small business applicant be U.S. Citizens or U.S. Nationals who have their Principal Residence in the United States, its territories or possessions.”
A December SBA notice had allowed up to 5% ownership by foreign nationals or legal permanent residents while still qualifying for a loan. The new rule reverses that allowance.
The SBA said the change aligns with President Trump’s January 2025 executive order titled “Protecting the American People Against Invasion,” which the White House said was intended to enforce immigration laws and ensure public safety.
Maggie Clemmons, an SBA spokesperson, said the guidance aims to create job opportunities for U.S. citizens. “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,” she said. Clemmons added the agency expects to offer more capital pending legislation to increase SBA loan limits for businesses “that are hiring, building and producing in America.”
The 7(a) program provides loan guarantees to lenders and allows business owners to borrow up to $5 million for working capital, refinancing debt, purchasing equipment, and buying or upgrading real estate.
The policy drew strong criticism from immigrant and small-business advocates, who warned it could stifle entrepreneurship. Carolina Martinez, CEO of CAMEO Network, cited research showing immigrants start new businesses at roughly twice the rate of U.S.-born residents and said barring legal permanent residents jeopardizes business creation and harms the economy. CAMEO said it will work with lawmakers to fight the guidance, calling it discriminatory.
Democratic members of the Senate Committee on Small Business and Entrepreneurship also condemned the move. Edward J. Markey of Massachusetts and Nydia Velázquez of New York called it “a devastating attack on immigrant entrepreneurs,” saying the administration’s decision sends a message that immigrants are not welcome to pursue the American Dream.
Edited by Alain Sherter