The US Small Business Administration (SBA) has updated a previously announced section on small business ownership for enterprises owned by non-US citizens. The government agency, which “helps Americans start, build and grow businesses,” bolstered US President Donald Trump’s ‘America First’ initiative by releasing a new policy notice on Monday, February 2 (US time).
The new SBA policy affects immigrant entrepreneurs, particularly from India, by implementing stricter ownership criteria within Trump’s immigration policies. (Representative image)Standard Operating Procedure (“SOP”) 50 10 8 SBA’s changes to Lenders and Development Company Loan Program guidance regarding businesses owned by non-US citizens are scheduled to take effect March 1, 2026.
Also read: H-1B visa registration for FY27 begins March 4 with new rules: Check if you’re eligible
Will Indians be affected?Immigrants originating from India are likely to be one of the most influential diaspora groups in the United States, as the South Asian country remains a major source of immigrants worldwide due to its large population.
“SBA requires that all direct and/or indirect owners of a small business applicant be 100% U.S. citizens or U.S. citizens who have their principal residence, territory or property in the United States,” said U.S. SBA Administrator Kelly Loeffler in a recent policy announcement.
This revision of the directive comes at a time when the Trump administration is emphasizing its strict immigration policies and massive deportation efforts within the United States. With this significant change, the new notice supersedes the previous Procedural Notice 5000-872050 update to SOP 50 10 8, which outlined citizenship and residency criteria for applicants.
According to the limited exception in the now-withdrawn December 2025 notice, a borrower may own up to 5% of foreign nationals, U.S. citizens, U.S. nationals, or lawful permanent residents (LPRs) whose “principal residence is outside the United States, its territories or possessions, as well as Ali with Ali status. However, it is important to note that Chinese nationals were expressly excluded from 5% foreign national ownership even at that time.
The circular issued this week states: “Further, and effective from the effective date of this circular, Legal Permanent Residents (LPRs) shall not own any percentage interest in an applicant/borrower, OC, or EPC.”
More Read
Indian-American Business Ownership in the United StatesAccording to data from the US Citizenship and Immigration Services, India ranks as the second largest country for immigrants receiving green cards in fiscal year 2024.
According to updated figures from the US Chamber of Commerce in June 2025, 40% of small business owners are foreign-born.
A significant portion of the hotel establishment in the United States is owned and operated by entrepreneurs of Indian origin.
Furthermore, a report by the National Foundation for American Policy states that Indian American-owned businesses generate more than $150 billion annually in revenue and provide employment for more than 800,000 people across the country in 2022.
