As of March 1, 2026, the Small Business Administration is requiring 100% U.S. Citizen or U.S. National ownership for any business seeking an SBA loan, precluding Green Card holders or partially foreign-owned businesses from the lending program. The news actually broke in early February, but the new requirements just took effect yesterday.
What were the rules before?
- Prior to the current administration rewriting the lending rules in early 2025, the SBA followed a “Majority Rule” that had been in place for decades. Businesses that were at least 51% majority owned by U.S. Citizens or Green Card holders were eligible for SBA loans.
- Then in mid-2025, the Trump Administration changed the rules to require 100% ownership by either U.S. Citizens or Green Card holders.
- In January 2026, a 5% “passive” foreign ownership exception was granted, with Green Card holders still eligible for the other 95%.
- However as of yesterday, only U.S. Citizens and Nationals are permitted to receive SBA loans, with Green Card holders excluded entirely.
If you're unfamiliar with the term “U.S. National,” it refers in this context to a person born in an outlying territory of the U.S., such as American Samoa or Swains Island. All U.S. Citizens are technically Nationals, but not all Nationals are Citizens. It's just some weird nuance to immigration law.
Why does this matter to the e-commerce industry?
- In Fiscal Year 2025, the SBA guaranteed a record 85,000 loans totaling $45B.
- Roughly 12,000 of those loans were issued to businesses in the “Retail Trade” sector.
- 7k were issued to the Transportation / Wholesale sector, which includes 3PL providers.
- And around 9,000 loans were approved for Information / Professional startups, which include SaaS, digital marketing, and ad agencies, of which e-commerce businesses represent around 20% of new business applications.
Prior to June 2025, approximately 10-15% of SBA loans historically involved at least some level of Green Card or non-Citizen ownership.
For tens of thousands of entrepreneurs, an SBA loan is their best vehicle to receive growth capital for their business. Now, if they were to receive equity investment in their business from a foreign entity or Green Card holder, it would disqualify them from SBA loans in the future.
Good idea? Bad idea? I'm not qualified to judge this one. I just wanted to report the facts so that you're aware of the changes and how it may impact your ability to obtain an SBA loan in the future.