Immigrant-Led Loan Partnership Offers Alternative to Trump-Restricted SBA Program

Following the Trump administration's March decision to restrict Small Business Administration (SBA) loans to U.S. citizens and nationals, excluding lawful permanent residents, immigrant business owners have turned to an alternative lending partnership. The Korean American Federation of Los Angeles (KAFLA) has partnered with the Jewish Free Loan Association (JFLA) to provide interest-free loans of up to $50,000 to small business owners who no longer qualify for traditional SBA financing.

The restriction affects a significant portion of California's entrepreneurial landscape. Immigrant entrepreneurs own nearly 40% of California's small businesses, with 11% owned by undocumented entrepreneurs, according to the Bay Area Council Economic Institute. Research from the Massachusetts Institute of Technology indicates that immigrant entrepreneurs are more likely than native-born Americans to start a business. Nearly 60% of California's 4.3 million small businesses are owned by entrepreneurs from underrepresented communities—Hispanic, Black, Asian American, Pacific Islander, or Native American.

The JFLA program allows borrowers to access funds for startup costs, rent, payroll, inventory, and equipment. Loans are tiered based on guarantor requirements: up to $7,500 with one guarantor, up to $36,000 with two guarantors, and up to $50,000 with three guarantors. Applicants must demonstrate steady income and meet credit requirements, with those borrowing more than $10,000 generally needing a credit score of at least 680. The program accepts applicants with either a Social Security number or an Individual Taxpayer Identification Number (ITIN).

Robert Ahn, KAFLA president, described the partnership as essential during difficult economic times. "When times get tough, it's resources like this that currently aren't available to our community that are much needed," Ahn said. The partnership emerged from conversations between Ahn and David Horvitz, vice president of JFLA's board, during a trip to Israel earlier in 2026, where they discussed economic challenges facing Koreatown businesses.

Businesses face mounting pressure from inflation and rising operational costs. Yong-ho Kim, president of the Korean American Food Industry Association and owner of the Japanese restaurant Arado, highlighted the predicament facing permanent residents: "But the rules suddenly changed so that SBA loans are only available to citizens. There are many permanent residents, too. Where are they supposed to borrow money to make up for the gaps?" Despite more demanding application requirements than traditional bank loans, Kim noted the absence of interest and fees makes the program attractive. He personally applied for the maximum $50,000 loan to test the process before recommending it to other business owners.

The JFLA, founded in 1904, serves residents of Los Angeles, Orange, Ventura, and Santa Barbara counties. The online application process takes approximately 10 minutes, followed by a Zoom interview with JFLA staff. More information is available at jfla.org.