{"id":283193,"date":"2026-03-12T13:56:43","date_gmt":"2026-03-12T17:56:43","guid":{"rendered":"https:\/\/ncrc.org\/?p=283193"},"modified":"2026-03-12T13:56:43","modified_gmt":"2026-03-12T17:56:43","slug":"closing-the-door-on-immigrant-entrepreneurs-sbas-new-loan-restrictions-create-barriers-for-non-citizen-small-business-owners","status":"publish","type":"post","link":"https:\/\/ncrc.org\/closing-the-door-on-immigrant-entrepreneurs-sbas-new-loan-restrictions-create-barriers-for-non-citizen-small-business-owners\/","title":{"rendered":"Closing the Door on Immigrant Entrepreneurs: SBA\u2019s New Loan Restrictions Create Barriers for Non-Citizen Small Business Owners"},"content":{"rendered":"

The Small Business Administration\u00a0(SBA)\u00a0recently\u00a0posted\u00a0a\u00a0<\/span>policy notice<\/span><\/a>\u00a0that would\u00a0prevent\u00a0legal permanent residents, such as\u00a0immigrants\u00a0with\u00a0green cards,\u00a0from accessing\u00a0any SBA financing\u00a0product\u00a0effective March 1, 2026.\u00a0Legal permanent residents\u00a0are authorized to\u00a0live and work in the US.\u00a0To receive an SBA-backed loan, the SBA\u00a0now\u00a0requires\u00a0small\u00a0businesses to\u00a0be 100%\u00a0owned by US\u00a0citizens or\u00a0nationals.\u00a0<\/span>\u00a0<\/span><\/p>\n

This is an abrupt reversal\u00a0from\u00a0SBA\u2019s\u00a0<\/span>original policy\u00a0notice<\/span><\/a>\u00a0released this past\u00a0December, which\u00a0would have\u00a0allowed\u00a0small businesses\u00a0that were\u00a0100% owned by\u00a0legal\u00a0permanent\u00a0residents to access SBA financing products. Small businesses that have\u00a05% of\u00a0its\u00a0ownership\u00a0held\u00a0by foreign\u00a0nationals\u00a0would\u00a0also\u00a0have\u00a0been\u00a0able to\u00a0access\u00a0these products.\u00a0<\/span>\u00a0<\/span><\/p>\n

The revised policy comes amid broader national debates over immigration enforcement and its effects on communities and local economies. In some areas, concerns about\u00a0Immigration and Customs Enforcement (ICE)\u00a0have contributed to uncertainty for immigrant-owned businesses,\u00a0leading some\u00a0<\/span>to fully or partially close their small businesses<\/span><\/a>\u00a0across the country.\u00a0<\/span>\u00a0<\/span><\/p>\n

Taken together, the new SBA loan restrictions and the effects of\u00a0ICE\u00a0likely\u00a0will\u00a0create\u00a0additional\u00a0obstacles for immigrant entrepreneurs\u00a0seeking\u00a0to start, sustain or grow small businesses in their communities.<\/span>\u00a0<\/span><\/p>\n

SBA\u00a0Loans as a Critical Lifeline for\u00a0Immigrant Entrepreneurs<\/span><\/b>\u00a0<\/span><\/h3>\n

Immigrant-owned small businesses<\/span><\/a>\u00a0play\u00a0an important\u00a0role\u00a0in\u00a0the\u00a0<\/span>national\u00a0economy<\/span>.\u00a0They create jobs,\u00a0generate\u00a0local\u00a0revenue\u00a0and\u00a0make downtown corridors vibrant with their cultural diversity.\u00a0<\/span>Immigrants are twice as likely than native-born,\u00a0US citizens to start a small business<\/span><\/a>.\u00a0In fact,\u00a0nearly 20%\u00a0of all small businesses in the US are\u00a0immigrant\u00a0owned.\u00a0There is a\u00a0wide range\u00a0of immigrant-owned small businesses\u00a0with a variety of\u00a0sizes\u00a0and\u00a0across multiple industries. Small businesses with\u00a0majority\u00a0immigrant ownership\u00a0<\/span>made an average of $100,000 to $1 million in revenue in 2024<\/span><\/a>,\u00a0which was\u00a0mostly distributed across the accommodation,\u00a0food\u00a0and retail trade industries.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u201cMany immigrants come to this country and turn to entrepreneurship as a way to financially support their families\u00a0often because of language barriers or because their diplomas and professional certifications from their home countries are not recognized in the United States\u00a0along with many other challenges,\u201d\u00a0said Daniella\u00a0Djiogan,\u00a0NCRC\u2019s\u00a0director of\u00a0small\u00a0business\u00a0support\u00a0services.<\/span>\u00a0<\/span><\/p>\n

Immigrant\u00a0entrepreneurs\u00a0are\u00a0also more\u00a0likely to face barriers to capital access\u00a0after arriving in the US.\u00a0<\/span>The SBA\u2019s\u00a0guaranteed\u00a0loans\u00a0<\/span><\/a>\u2014\u00a07(a) loans, 504 loans\u00a0and microloans\u00a0\u2014\u00a0are\u00a0attractive options\u00a0for\u00a0small business owners\u00a0seeking\u00a0lower interest rates and flexible terms.\u00a0<\/span>The 7a and 504 loan programs offer long-term financing\u00a0for\u00a0major fixed assets\u00a0like land,\u00a0buildings\u00a0and equipment, while the\u00a0microloan\u00a0program\u00a0offers\u00a0up to\u00a0$50,000\u00a0for repairs and enhancements.\u00a0<\/span>\u00a0<\/span><\/p>\n

With SBA\u2019s new citizenship requirements\u00a0now in place,\u00a0green\u00a0card-holding immigrants can no longer access these programs.\u00a0Furthermore,\u00a0banks\u00a0may\u00a0be compelled\u00a0to\u00a0<\/span>adopt more stringent ownership and citizenship verification procedures<\/span><\/a>, which would\u00a0not only\u00a0delay\u00a0processing times\u00a0for all small business owners, but also increase administrative costs for lenders.\u00a0Consequently,\u00a0predatory lenders may be able to lure\u00a0immigrant\u00a0entrepreneurs\u00a0into\u00a0borrowing high-interest loans,\u00a0subsequently\u00a0trapping them in a debt cycle.\u00a0<\/span>\u00a0<\/span><\/p>\n

\u201cAccess to capital through the SBA may have been one of the only\u00a0viable\u00a0pathways for them to start or grow their businesses,\u201d\u00a0Djiogan\u00a0said.\u00a0\u201cThat access does not just\u00a0impact\u00a0one business owner…\u00a0It\u00a0affects job creation, local\u00a0spending\u00a0and the greater economic stability within communities.\u201d\u00a0<\/span>\u00a0<\/span><\/p>\n

ICE\u2019s Impact on\u00a0Main Street Businesses\u00a0<\/span><\/b>\u00a0<\/span><\/h3>\n

Increased immigration enforcement activity has also affected small business operations in some communities\u00a0across the country.\u00a0<\/span>Advocacy organization\u00a0Small Business Majority conducted a poll that found that\u00a0<\/span>47%\u00a0of small\u00a0business owners say increased immigration enforcement\u00a0actions\u00a0has had a negative impact on their business<\/span><\/a>\u00a0by way of less foot traffic, staff\u00a0reductions\u00a0and decreased revenue.\u00a0\u00a0<\/span>\u00a0<\/span><\/p>\n

\u201c<\/span>It’s businesses that employ\u00a0green-card holders and immigrants that are being\u00a0impacted\u00a0because they fear going to work or coming out of their home,\u201d\u00a0said\u00a0Amber\u00a0<\/span>C\u00f3rdoba, co-chair of the Arizona Community Development Financial Institutions\u00a0Network and NCRC member<\/span>.\u00a0\u201cIn some\u00a0cases\u00a0in Tucson, we have had two businesses close,\u00a0[with]\u00a0one business owner\u00a0[selling]\u00a0their business to their partner and mov[ing]\u00a0out of the country.\u201d<\/span>\u00a0<\/span><\/p>\n

In the long term, the impact of ICE and the SBA loan restrictions likely will deplete a source of income for immigrant entrepreneurs who meaningfully contribute to the economy, which could result in higher prices for goods and services in a time when Americans are burdened by affordability concerns. <\/span>\u00a0<\/span><\/p>\n

In Congress, Senator Ed Markey (D-MA), ranking member of the Senate Committee on Small Business & Entrepreneurship, introduced the Small Business ICE Disruption Fund Act<\/a>. The bill would allow eligible small businesses affected by immigration enforcement actions to recover up to $1 million in lost revenue. Markey\u2019s office, together with other lawmakers, also sent a letter to SBA Administrator Kelly Loeffler raising concerns about the SBA loan restrictions. The bill is unlikely to become law in the near future.\u00a0 <\/span>\u00a0<\/span><\/p>\n

Whether\u00a0it\u2019s\u00a0the Dominican-owned bodega or the Ethiopian-owned cafe, the South Asian-owned corner\u00a0grocery\u00a0or the Vietnamese-owned nail salon,\u00a0i<\/span>mmigrant-owned small businesses are an important part of the nation\u2019s economic and cultural landscape. Restrictions on SBA loans may reduce access to programs that support the growth and expansion of these businesses, with potential implications for economic activity nationwide.<\/span>\u00a0<\/span><\/p>\n

\u00a0<\/span><\/p>\n

Manan Shah is the Policy Advisor with NCRC’s Policy & Government Affairs team.<\/em><\/p>\n

Photo credit: Alex Boyd via Pexels.<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The Small Business Administration\u00a0(SBA)\u00a0recently\u00a0posted\u00a0a\u00a0policy notice\u00a0that would\u00a0prevent\u00a0legal permanent residents, such as\u00a0immigrants\u00a0with\u00a0green cards,\u00a0from accessing\u00a0any SBA financing\u00a0product\u00a0effective March 1, 2026.\u00a0Legal permanent residents\u00a0are authorized to\u00a0live and work in the US.\u00a0To receive an SBA-backed loan, the SBA\u00a0now\u00a0requires\u00a0small\u00a0businesses to\u00a0be 100%\u00a0owned by US\u00a0citizens or\u00a0nationals.\u00a0\u00a0 This is an abrupt reversal\u00a0from\u00a0SBA\u2019s\u00a0original policy\u00a0notice\u00a0released this past\u00a0December, which\u00a0would have\u00a0allowed\u00a0small businesses\u00a0that were\u00a0100% owned by\u00a0legal\u00a0permanent\u00a0residents to access SBA financing 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Shah","author_link":"https:\/\/ncrc.org\/?s=manan+shah"},"uagb_comment_info":0,"uagb_excerpt":"The Small Business Administration\u00a0(SBA)\u00a0recently\u00a0posted\u00a0a\u00a0policy notice\u00a0that would\u00a0prevent\u00a0legal permanent residents, such as\u00a0immigrants\u00a0with\u00a0green cards,\u00a0from accessing\u00a0any SBA financing\u00a0product\u00a0effective March 1, 2026.\u00a0Legal permanent residents\u00a0are authorized to\u00a0live and work in the US.\u00a0To receive an SBA-backed loan, the SBA\u00a0now\u00a0requires\u00a0small\u00a0businesses to\u00a0be 100%\u00a0owned by US\u00a0citizens or\u00a0nationals.\u00a0\u00a0 This is an abrupt reversal\u00a0from\u00a0SBA\u2019s\u00a0original policy\u00a0notice\u00a0released this past\u00a0December, which\u00a0would have\u00a0allowed\u00a0small businesses\u00a0that were\u00a0100% owned by\u00a0legal\u00a0permanent\u00a0residents to access SBA financing…","_links":{"self":[{"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/posts\/283193","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/users\/4019"}],"replies":[{"embeddable":true,"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/comments?post=283193"}],"version-history":[{"count":0,"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/posts\/283193\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/media\/283198"}],"wp:attachment":[{"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/media?parent=283193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/categories?post=283193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ncrc.org\/wp-json\/wp\/v2\/tags?post=283193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}