SBA Bans Loans to Foreign Nationals, Non-Citizens

The U.S. Small Business Administration announced a new policy March 9 barring foreign nationals and non-citizens from accessing SBA-guaranteed loans.

The policy requires applicants for all SBA-backed loan programs to be U.S. citizens or U.S. nationals with a principal residence in the U.S.

The expanded restriction applies to the SBA’s Surety Bond Guarantee and Microloan programs.

The SBA says the programs expand access to capital for businesses that may not qualify for traditional financing.

The new policy builds on earlier action taken in March that made businesses that are wholly or partially owned by foreign nationals ineligible for the SBA’s 7(a) and 504 loan programs.

Policy Change

SBA Administrator Kelly Loeffler cited growing demand for capital and limited federal lending capacity as key drivers of the change.

In a statement, she noted that Congress sets an annual cap on SBA-guaranteed lending, adding the agency is focusing on “American-owned businesses that are creating jobs here at home.”

SBA Administrator Kelly Loeffler said the policy focuses lending on American-owned businesses.

The change is set to take effect in April.

According to the SBA, the agency approved 3,358 loans in fiscal year 2025 for businesses owned in part by lawful permanent residents.

Those loans accounted for about 4% of the agency’s approximately 85,000 loan approvals that year.

Broader Changes

The updated eligibility requirements are part of a broader series of administrative changes at the SBA.

Those changes include implementing citizenship verification across loan programs.

The SBA also plans to relocate field offices out of jurisdictions the agency has identified as “sanctuary cities.”

Business owners seeking SBA loans should review eligibility requirements and ownership structures ahead of the policy’s implementation.