New SBA lending rules could curb loans to hemp businesses

(This is an abridged version of a story that appears at Marijuana Business Daily.)

The U.S. Small Business Administration updated its lending guidelines with new rules that could have a major impact on businesses servicing the cannabis industry – and not just those on the marijuana side.

The revised guidance, published in early April, prohibits banks from issuing SBA-backed loans to any company that has a direct business relationship with a cannabis or hemp firm.

For hemp-related businesses, any company that “grows, produces, processes, distributes or sells products purportedly made from hemp is ineligible unless the business can demonstrate that its business activities and products are legal under federal and state law. Examples of legal hemp products include paper, clothing and rope.”

The new rules could have big implications for firms with business operations that extend beyond cannabis. For example, landlords who lease space to marijuana-related firms would not qualify for an SBA loan.

Click here to read more about how the new guidelines will affect direct and indirect marijuana-related business.

Subscribe to our Newsletter

2 comments on “New SBA lending rules could curb loans to hemp businesses
  1. SolRevolt on

    This excerpt appears to be written by someone with no understanding of SBA lending program. Call us to get the facts

    Landlords cannot obtain SBA financing unless they are also the owners of the operating company.

    • Adam Horowitz on

      I want to offer our hemp farmers lending options. They are typically in need of seeds and equipment. How do I contact you?


Leave a Reply

Your email address will not be published. Required fields are marked *