The Small Business Administration (SBA) recently sent a notification to its lenders instructing them to end politicized or unlawful banking practices. This comes as the SBA strives to align with the Administration’s Executive Order to stop any type of financial discrimination. Lenders who do not comply will risk losing their good standing with the SBA and will be subject to disciplinary measures.  

The Executive Order released on Aug. 7, 2025, outlines the following requirements for lenders to implement by Dec. 5, 2025: 

• Identify any past or current formal or informal policies or practices requiring, encouraging, or otherwise influencing the institution to engage in politicized or unlawful debanking. 
• Make reasonable efforts to identify and reinstate any previous customers/members of their institution through a debanking action in violation of a statutory or regulatory requirement, and send a notice of the reinstatement. Additionally, any customer/members politicized or unlawful debanking violations identified in fulfillment of this Executive Order that were denied access to financial services provided by their institution, should be addressed and provided the option to renew to engage services previously denied. 

Lenders must submit a report to the SBA by Jan. 5, 2026, addressing their compliance with the above requirements to remain in good standing with the agency and avoid penalties. 

Doeren Mayhew’s SBA pros will continue to stay abreast of developments pushed by the SBA impacting lenders.