SBA Policy Shift: Green Card Holders Face Business Loan Exclusion Effective March 1, Raising Concerns for Indian Entrepreneurial Community

The U.S. Small Business Administration (SBA) has implemented a significant regulatory revision, eliminating foreign ownership exceptions for its loan programs, which will directly impact lawful permanent residents (LPRs) commencing March 1. This policy alteration, detailed in the Federal Register, removes previous provisions that allowed certain foreign-owned entities, including those controlled by LPRs, to qualify for SBA-guaranteed loans under specific conditions. Analytical assessment indicates this move aligns with broader federal efforts to prioritize domestic ownership in economic support initiatives, though it introduces substantial barriers for immigrant entrepreneurs who have obtained permanent residency through legal channels. The Indian diaspora, representing one of the largest and most economically active immigrant groups in the United States, is particularly vulnerable to these changes. Many Indian LPRs have established small and medium enterprises that contribute significantly to local economies and job creation. This policy shift may inadvertently stifle innovation and economic growth within these communities, while raising questions about the alignment of immigration status with access to capital. Stakeholders are advised to review existing financing arrangements and explore alternative funding mechanisms ahead of the implementation date.