By Elizabeth Troutman Mitchell, The Daily Signal | October 21, 2025
Hundreds of small businesses are in peril during the federal government shutdown as they are unable to access their federal government loans, according to President Donald Trump’s Small Business Administration.
“Thanks to President Trump’s agenda to reduce taxes, regulation, and unfair trade deals, small business optimism is at seven-year highs, resulting in the SBA serving a record 85,000 job creators with $45 billion in federally backed loans—supporting historic hiring, expansion, and confidence on Main Street,” SBA chief Kelly Loeffler said in a statement to The Daily Signal.
“Senate Democrats have decided to cut off that momentum and that capital for Main Street, in favor of growing government spending by $1.5 trillion and blocking a clean funding bill to reopen the government,” she continued.
The shutdown has frozen SBA’s core 7(a) and 504 small business lending programs. Those are SBA’s primary business loan programs for providing financial assistance to small businesses.
Each business day the shutdown continues, about 320 small businesses can’t access $170 million in SBA-backed commercial loans. That means $2.5 billion has been blocked from 4,800 small businesses during the shutdown, which is about to enter its fourth week.
“With the SBA’s loan programs shuttered, thousands of small businesses are now unable to access the vital funding they need to survive, let alone thrive—and will soon begin cutting hours and benefits, laying off workers, and contemplating closing up shop for good,” Loeffler said.
The loan programs are funded by lender fees, enabling them to operate without cost to taxpayers.
Every week, $126,885,142 in loans to California small businesses alone can’t be approved.
California is the state with the largest number of loans not approved per week of the shutdown—212; followed by Texas with 128; Florida with 135; and New York with 106.
Elizabeth Troutman Mitchell is the White House Correspondent for "The Daily Signal."
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