The U.S. House has passed legislation barring all noncitizens, except permanent residents from acquiring Small Business Administration loans.
The American Entrepreneurs First Act of 2025, which passed in a 217-190 vote Friday, would require the SBA to verify the citizenship status and age of every applicant, codifying reforms recently implemented by the agency.
If the bill passes the Senate and becomes law, the SBA will permanently exclude illegal immigrants, refugees and asylees, visa holders, DACA recipients or nonimmigrants from obtaining taxpayer-funded SBA loans. It would also disqualify companies partially or completely owned by such individuals.
Co-sponsor of the bill, Rep. Beth Van Dunye, R-Texas, told lawmakers Friday that the legislation is “just common sense.” She added that it does not prohibit lending based on applicants’ nationality — as some Democrats have contended — but rather is based on legal residency or status.
President Donald Trump has made immigration policy, including halting taxpayer-funded subsidies for foreign nations, a key focus in his second term. He issued an order in February directing all federal agencies to cease funding public benefits for foreign nationals residing illegally in the U.S.
Yet House Whip Katherine Clark, D-Mass., told constituents that the bill “is a solution in search of a problem” that will harm American small businesses.
“Applying onerous, unfunded paperwork requirements at SBA and making it harder for U.S. small businesses to access funding – all while President Trump’s tariffs wreak havoc on them – is hypocrisy at its finest and will result in small businesses across the country closing or never getting off the ground to begin with,” Clark said Friday.
The bill’s proposed age verification requirement is a less contentious issue among lawmakers. An investigation by the Department of Government Efficiency found that between 2020 and 2021, SBA doled out thousands of loans worth $333 million to applicants over 115 years old, and thousands more, worth $300 million, to borrowers under 11 years old.
SBA Administrator Kelly Loeffler praised the bill in a post-passage statement as a step toward greater transparency and better stewardship of taxpayer dollars.
“Illegal aliens and fraudsters have no right to taxpayer-backed loans at the SBA,” Loeffler said. “With these common-sense guardrails, the American Entrepreneurs First Act will help put our deserving job creators first.”
