Kelly Loeffler, the Administrator of the U.S. Small Business Administration, has marked the first 100 days of the Trump administration by detailing shifts at the agency overseeing resources for millions of entrepreneurs. The SBA, which some observers thought might be consolidated, has seen significant changes in its operations and portfolio under the new leadership.
One of the most changes involves taking responsibility for the student loan portfolio, a move previously overseen by the Department of Education. This new sprawling loan portfolio totals $1.6 trillion and includes managing the collection process. This shift differs from suggestions in documents like Project 2025, which proposed other agencies for the task. The legal framework established by the Higher Education Act of 1965 and the U.S. Code designates the Department of Education as the entity for student loan repayment, leading groups such as the Center for American Progress to question the SBA's legal standing in collections.
Alongside the expanded portfolio, the SBA is reducing its workforce by 43 percent, a change the agency states will save taxpayer money.
The agency also reinstated lender fees for its primary 7(a) loan program. The return of fees follows the program posting negative cash flow and aims to support sustainability. Fees vary based on loan size, ranging from 2 percent on the guaranteed portion of smaller loans up to 3.5 percent for larger amounts. These fees will likely increase borrowing costs for business owners.
Underwriting standards are also undergoing revision. The previous administration's approach, known as "Do What You Do," sought to broaden access to capital, resulting in increased small-dollar lending. However, this approach also led to rising charge-offs and delinquencies within the portfolio. The new administration is implementing tighter standards to address these vulnerabilities.
Kelly Loeffler recently addressed the state of small business and the broader economy, crediting the Trump administration's policies for creating a favorable environment. Deregulation, tax cuts, and efforts to promote "Made In America" initiatives are cited as drivers of economic gains.
While the Administrator touts growth across sectors, some business owners express cautious optimism. Patrice Hull, who operates a shop in Little Five Points, Georgia, noted that tariffs are impacting her bottom line and forcing price adjustments.
Speaking in Suwanee, Georgia, Kelly Loeffler highlighted successes, including reduced core inflation and lower energy prices. She stated that a surge in private investment is directing capital toward manufacturing and technology opportunities in the U.S., suggesting that current trade discussion challenges will pass.
Loan approval numbers in the first 100 days under the Trump administration were higher compared to the Biden-led SBA's initial period, though the latter took office during the COVID-19 pandemic. Loan program reforms, including citizenship verification and stricter underwriting, are cited for saving taxpayer money.
Lisa Winton, CEO of Winton Machine, shared that cash flow, finding a qualified workforce, and tariffs pose challenges for her manufacturing company. Regarding regulations, Winton expressed hope for a more level playing field under the new policies.
"Small businesses borrow when they have increased confidence there's an opportunity for growth, and we've seen strong optimism as we've gone across this country thanks to President Trump's deregulation tax cut agenda that's pro-American worker," Loeffler said.
