A group of over 60 state legislators are pressuring the federal Small Business Administration to rescind its policy restricting lawful residents who are immigrants from participating in its lending programs.
“So many small businesses are struggling to get by, and in particular residents that are doing everything the right way, pursuing the American dream, now being shut off by a source of capital that’s really important for our small businesses here,” said Rep. Andy Vargas of Haverhill, who is leading the effort on Beacon Hill along with Sen. Adam Gomez of Springfield.
In March 2025, the Small Business Administration (SBA) issued a policy notice that barred any small businesses owner who is not a U.S. citizen, national, or green card holder from receiving SBA financing. That includes refugees, asylees, visa holders, immigrants with other statuses, and foreign nationals.
In March 2026 that was expanded to bar green card holders from SBA financing in several SBA programs.
Vargas and Gomez co-chair the Small Business and Community Development Committee. They and other signatories say the restrictions will and are impacting small businesses by restricting their ability to expand and create jobs.
“By disallowing some of the most entrepreneurial members of our community from accessing the capital resources that may make the difference between success and closure, we are not only hurting families and communities but stunting the growth of our economy,” legislators wrote in a letter to SBA Administrator Kelly Loeffler.
An analysis by the Senate Committee on Small Business and Entrepreneurship under Sen. Ed Markey found that in the fiscal year that ended in June 2025, about 237 SBA loans went to green card holders in Massachusetts. Those business owners invested nearly $100 million of capital and supported approximately 1,100 jobs, according to the analysis
Sergio Espinoza is the owner of Lynn-based food service consulting firm Manka Inc. and former president of the Massachusetts Latino Restaurant Association as well as board member of the North Shore Latino Business Association. Originally from Peru, he’s now a U.S. citizen, but says the SBA’s new policy has hurt many of his clients.
“Access to capital is one of the big things. It allows us to be able to grow, hire more, also buy the building that we operate in, right,” he said recently on a panel. “It’s the one thing that gives us a little bit of stability. The SBA now having 100% citizenship requirement really has killed that for a lot of our clients, a lot of businesses that just — they’re green card holders, or maybe they have partners who are not U.S. citizens.”
Espinoza had planned to offer several of his employees ownership rights in his business, but says he now can’t because one them is a visa holder.
U.S. Sen. Ed Markey filed the Investing in the American Dream Act in April, seeking to restore and codify previous SBA citizenship rules for several of its programs. The bill currently has 20 co-sponsors in the Senate.
“Rather than supporting hardworking entrepreneurs, Trump’s Small Business Administration has put in place a racist policy to deny loans to legal immigrants,” he told a panel of immigrant business owners, educators, association heads, and advocates in May. “And all of this despite the fact that immigrants are more likely to start a business than native-born citizens in Massachusetts and across the country.”
Raymond Lanza-Weil, president of Common Capital, a nonprofit community loan fund that serves people of low- and moderate incomes in Western Massachusetts, has seen decreased application volume from immigrants and people of color. His organization attributes the decline to policies and “climate of fear,” he said.
It’s a deterrent even for Common Capital as it seeks to support low-income small business owners and entrepreneurs.
“We’re considering backing away from the SBA’s programs. The SBA’s recent policy changes that prevent legal permanent residents and other noncitizens from participating in any of the SBA’s valuable programs are changes that are unwelcome, immoral, and antithetical to our purpose, to our mission, and to our vision for Massachusetts communities and businesses,” he said.
He said about 10% of the company’s portfolio is composed of borrowers who identify as immigrants, even though some are US citizens. In the past five years, Common Capital has assisted at least nine green card holders and asylees with SBA programs. He said he knows of at least three people who have not been able to expand or launch businesses — one in trucking, one a general contractor, and another for a pizza restaurant — because of the SBA’s policy change.
GBH News couldn’t find numbers of denied SBA loans, as banks generally do not systemically track who are declined loans. The SBA doesn’t require banks to report who they’ve denied either.
But a 2025 survey by the MassINC and the Coalition for an Equitable Economy underscores the need among populations that tend to have many green card holders.
That survey showed that 68% of Black business owners and 70% of Latino business owners — many of whom have green cards — had a pressing need for capital access, while only 32% of white business owners experienced the same need.
