How small-business loans got caught in Trump's immigration crackdown
A small-business loan helped Sayuri Tsuchitani open her own storefront: a Japanese head spa. But today, she wouldn't qualify because the Small Business Administration has dramatically changed its lending policy. Courtesy of Sayuri Tsuchitani hide caption Sign up for the Planet M
A small-business loan helped Sayuri Tsuchitani open her own storefront: a Japanese head spa. But today, she wouldn't qualify because the Small Business Administration has dramatically changed its lending policy. Courtesy of Sayuri Tsuchitani hide caption
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Before Sayuri Tsuchitani became an entrepreneur, she spent two decades on her feet: cutting, coloring and styling hair. Hairdresser's work is physically tough, and Tsuchitani often wondered how she'd manage as she grew older.
When the pandemic shut the Los Angeles salon where she worked, she recognized a chance to make a change: She applied for a loan from the U.S. Small Business Administration, or the SBA, for a business of her own.
"The SBA led me to my success of the American Dream," said Tsuchitani, who took advantage of a pandemic-era funding program to open a Japanese head spa: a salon offering blood-flow massages, ayurvedic oil treatments and deep scalp cleanses. She launched one location, then two more; hired one worker, then nine more.
But today, the SBA would disqualify Tsuchitani from its loan program because of a new policy. Tsuchitani is a green-card holder, also known as a lawful permanent resident; she moved from Japan 28 years ago. And in March, the U.S. small-business agency, for the first time in its history, stopped approving loans to firms that are not fully owned by U.S. citizens — and only citizens.
The change is part of the quieter side of the Trump administration's push to discourage immigration. As many agencies have limited how noncitizens can qualify for programs — like housing subsidies or commercial trucking licenses — the SBA moved to do the same. Early announcements said the agency would ferret out " hostile foreign nationals " and " illegal aliens ." But the SBA's rules had long restricted lending to immigrants, mainly to those living here legally and permanently. And that's what the SBA cut .
"It was a bit of a shock to the system," said Eda Henries, who runs a firm that helps small businesses raise and manage funds. "No one even thought for a second that would be on the table. No one expected that it would include legal permanent residents."
