As previously reported, on August 7, 2025, President Trump issued an Executive Order, Guaranteeing For Banking for All Americans, which included specific requirements to be implemented by SBA relating to its participating lenders. On August 26, 2025, SBA sent a letter to all SBA lenders signed by Wendell Davis, General Counsel, implementing those requirements.  

As stated in the SBA letter: “Pursuant to the Fair Banking Executive Order, the SBA is taking the action described in this letter to ensure no financial institution participating in the agency’s loan guarantee programs unfairly targets any current or future customers on the basis of political, religious, or ideological beliefs. …“As required by the Fair Banking Executive Order, Executive Order 14149 (Restoring Freedom of Speech and Ending Federal Censorship), the U.S. Constitution, and the laws, regulations and rules of the United States, the SBA hereby requires your organization and its subsidiaries as identified in the Fair Banking Executive Order, to cease any politicized or unlawful debanking actions“.  

The letter includes four actions which lenders must take by December 5, 2025. Specifically, SBA lenders must:

  • Identify any past or current formal or informal policies or practices that require, encourage, or otherwise influence your institution to engage in politicized or unlawful debanking as specified by the Fair Banking Executive Order;
  • Make reasonable efforts to identify and reinstate any previous clients of your institution or any subsidiaries denied service through a politicized or unlawful debanking action in violation of a statutory or regulatory requirement under section 7(a) of the Small Business Act (15 U.S.C. 636) or any requirement in a Standard Operating Procedures Manual or Policy Notice, and send notice of the reinstatement to the injured party;
  • Identify all potential clients denied access to financial services provided by your institution or any subsidiaries through a politicized or unlawful debanking action in violation of a statutory or regulatory requirement under section 7(a) of the Small Business Act or any requirement in a Standard Operating Procedures Manual or Policy Notice, and provide notice to each otherwise qualified client advising of the denied access and the renewed option to engage in such services previously denied; and
  • Identify all potential clients denied access to payment processing services provided by your institution or any subsidiaries through a politicized or unlawful debanking action in violation of a statutory or regulatory requirement under section 7(a) of the Small Business Act or any requirement in a Standard Operating Procedures Manual or Policy Notice, and provide notice to each victim advising of the denied access and the renewed option to engage in such services previously denied.

As indicated in the letter, compliance with the Fair Banking Executive Order and the requirements cited above is required in order for lenders to maintain good standing status under 13 CFR § 120.410(e) [Requirements for all participating lenders] and § 120.420(e) [Definitions — Good Standing]. In this regard, the letter clarifies that any politicized or unlawful debanking actions, regardless of whether it directly involves an SBA loan applicant, violates the Fair Banking Executive Order and the requirements for [an] institution to remain in good standing with the SBA”.  

As stated in the letter, within 30 days of the December 5 deadline, each lender must provide SBA ([email protected]) a detailed report “addressing and evidencing [its] compliance with each of the above requirements“. 

Finally, the letter states that: “Failure to comply will result in SBA taking appropriate oversight action. As provided for in SBA SOP 50 53 (2), these actions may include, but are not limited to, non-renewal of delegated authority, a headquarters meeting, increased reporting, a Supervisory Letter, requiring a Board Resolution or Commitment Letter, and for intermediaries, withholding of technical assistance grant funds and, as identified in the Fair Banking Executive Order, referral to the U.S. Attorney General for appropriate civil action”. 

While not specifically stated in the SBA letter, we assume that any lender questions should also be directed to the [email protected] mailbox.  

Please refer to the letter for additional information.