WASHINGTON — Chair of the Congressional Asian Pacific American Caucus (CAPAC) Rep. Grace Meng (D-N.Y.) on Feb. 10 released the following statement after the Small Business Administration (SBA) revised its loan program guidance to deny legal permanent residents from accessing SBA loans.
“America has long stood as the land of opportunity, where hard work opened the door to a better life for you and your family. The SBA’s decision to deny hard-working legal immigrants the capital they need to start or grow a business will effectively lock millions of Asian American, Native Hawaiian, and Pacific Islander (AANHPI) families out of the American Dream.
“There are more than 3 million AANHPI-owned small businesses across the country that are responsible for nearly a trillion dollars in economic activity. This cruel decision is rooted in xenophobia and will only weaken our economy, hurt job creation, and stifle the spirit of entrepreneurship that makes our country great.”
The SBA revised its loan program guidance to require all loan applicants to be U.S. citizens or U.S nationals and have their principal residence in the U.S., territories, or possessions starting on March 1. This means that any small business owner who is a green card holder and owns even 1% of a business will disqualify that business from receiving an SBA loan.
Previously, the SBA issued updated citizenship and residency requirements for its 7(a) and 504 loan programs, which allowed green card holders or foreign nationals owning up to 5% of a small business to qualify. However, the notice singled out Chinese nationals as ineligible for SBA assistance.
These updated policies are harmful to the Asian American community, 65% of whom are foreign-born, and threaten the over 3 million AANHPI–owned businesses nation-wide that employ 5.2 million people and generate nearly a trillion in sales.
By prohibiting green card holders and non-U.S. citizens from applying to the SBA’s flagship lending program, thousands of these small businesses — often run as family businesses with immigrant parents and their American children — will lose out on billions of dollars in support. In FY2024, the SBA backed 8,900 loans to Asian-owned businesses, totaling $7.2 billion, and the number of Asian businesses funded increased by 70% from FY2020.