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Trump Deals Massive Blow to Economy With New Small Business Loan Rule
Donald Trump’s administration will bar green card holders (read: legal, permanent residents) from receiving small business loans, threatening to further unravel the U.S. job market.
The Small Business Administration has barred green card holders from receiving SBA loans and will expand that policy to SBA-backed loans from private companies starting in April, the Associated Press reported Monday. Additionally, any business that is even partially owned by a green card holder will no longer be eligible for a small business loan.
Speaking at CPAC Saturday, SBA administrator Kelly Loeffler touted the end of “DEI lending” to “foreign nationals.” Of course, the individuals affected by the policy change are not foreign nationals but legal permanent residents who may have lived and worked for their entire lives in the United States.
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CA small businesses
Why now: Green-card holders no longer qualify for loans from the Small Business Administration, eliminating a longtime source of financing for immigrants that advocates say will discourage job creation and harm the economy. The SBA limited access to its loans to U.S. citizens and nationals only starting in March, and expanded that policy to SBA-backed loans beginning in April. On top of that, any business that’s even partly owned by a permanent legal resident with a green card is no longer eligible for the loans.
Why it matters: California — which has the most small businesses and the largest immigrant population in the nation — could be most affected. SBA loans have been important to immigrant entrepreneurs because they typically are low-interest and available to those without an established credit history. The agency has also backed loans by private funders, providing a government guarantee for people banks may deem riskier. Now, all those loans are off the table for owners and would-be owners of restaurants, bake shops, law practices, medical clinics, taxi medallions, nail salons and more who hold green cards.
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