New SBA Loan Rule Bars Green Card Holders

Policy change limits small business loans to citizen-owned firms only.

Published on Feb. 12, 2026

Got story updates? Submit your updates here. ›

The U.S. Small Business Administration (SBA) has issued a new rule that will bar green card holders from applying for SBA loans and limit SBA loan eligibility to businesses that are fully owned by U.S. citizens. The policy change, which takes effect on March 1, rescinds a previous exception that allowed up to 5% foreign ownership in SBA-backed businesses.

Why it matters

The move is part of the Trump administration's broader crackdown on immigration, which has faced legal challenges from human rights groups who say the policies create a fearful environment for minorities. Critics argue the SBA decision will deny hard-working legal immigrants access to the capital they need to start or grow a business, locking them out of the 'American Dream'.

The details

The SBA notice states that starting March 1, businesses seeking SBA-backed loans must be completely owned by U.S. citizens or U.S. nationals whose primary residence is in the United States. The new rule rescinds a previous exception that allowed up to 5% foreign ownership, including from green card holders whose primary residence was outside the U.S. and its territories.

  • The new SBA loan policy takes effect on March 1, 2026.

The players

President Donald Trump

The President of the United States whose administration implemented the new SBA loan policy.

U.S. Representative Grace Meng

A Democratic member of the U.S. House of Representatives who criticized the SBA decision as denying 'hard-working legal immigrants the capital they need to start or grow a business'.

U.S. Small Business Administration (SBA)

The U.S. government agency that provides loans and assistance to small businesses across America, and which issued the new policy barring green card holders from SBA loans.

Got photos? Submit your photos here. ›

What they’re saying

“The SBA's decision amounted to denying 'hard-working legal immigrants the capital they need to start or grow a business' and will lock them 'out of the American Dream.'”

— Grace Meng, U.S. Representative (ksgf.com)

What’s next

The new SBA loan policy is set to take effect on March 1, 2026, and is expected to face legal challenges from immigrant advocacy groups.

The takeaway

This policy change is the latest in the Trump administration's broader crackdown on immigration, which has drawn criticism from human rights groups who say it creates a fearful environment for minorities. The decision to bar green card holders from SBA loans is seen as further limiting opportunities for legal immigrants to participate in the 'American Dream' of entrepreneurship and small business ownership.