On August 26, 2025, the U.S. Small Business Administration (SBA) sent a notice to its network of approved lenders directing them to complete certain actions by December 5, 2025. The move is in response to Executive Order 14331, Guaranteeing Fair Banking for All Americans (EO 14331), which aims to eliminate discriminatory banking practices—commonly referred to as “debanking”—where financial institutions deny services based on political, religious, or lawful business affiliations. This order has significant implications for financial institutions, regulators, and clients operating in sensitive or politically exposed sectors.
Consistent with the requirements of EO 14331, the SBA sent a notice requiring lenders to perform the following steps:
The following text is quoted verbatim from the SBA letter.
- Identify any past or current formal or informal policies or practices that require, encourage, or otherwise influence their 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 their 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 their 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.
Lenders must submit a report to the SBA by January 5, 2026, addressing and evidencing their compliance with the above directives to remain in good standing with the agency and avoid punitive measures.1
Why is this important?
Now that deadlines are set for the completion of the lookback, lenders must be proactive to ensure they remain in good standing with the SBA. Lenders should review processes and procedures immediately and careful consideration should be given to the methodology for performing the lookbacks based on the guidance. Loan or service denials should have robust documentation to clearly demonstrate that the denial was not in violation of EO 14331.
What is the potential impact with the prudential regulators?
EO 14331 also calls upon the federal banking regulators to conduct a review within 120 days to identify institutions that have engaged in politicized or unlawful debanking. Although the federal banking regulators have not specified a process at this time, they have affirmed their commitment to complying with the executive order. Financial institutions should take proactive steps through lookbacks and other means of review to identify any formal or informal policies or practices that could be viewed as influencing or permitting the debanking of any individuals or businesses as defined within EO 14331.
How can Forvis Mazars help your institution?
Establishing robust policies and procedures is critical to identifying any existing controls that may influence decisions related to the industries or individuals referenced in the executive order.
Institutions should conduct proactive lookback reviews of service denials— especially in lending and deposit accounts— to determine whether any customers were affected by policies or practices inconsistent with EO 14331. This process may include leveraging analytics to flag keywords or industry classifications that could indicate potential debanking concerns. Additionally, any customer complaints involving service denials should be reexamined to assess whether debanking issues were present and require remediation.
Certain factors may pose risks that exceed an organization’s established risk appetite and may warrant not pursuing or exiting a customer relationship. Institutions should develop clear written policies outlining what could lead to a rejection or exit of a customer relationship without violating EO 14331. Furthermore, institutions should carefully assess the practices and procedures regarding decisions to deny services or exit customer relationships and should establish clear documentation requirements justifying the denial or exit.
Our compliance and analytics teams are well-equipped to support these efforts. Given the potential resource demands of these reviews, our assistance can help establish a thorough and efficient approach.
- 1https://www.sba.gov/article/2025/08/26/sba-orders-lenders-end-practice-debanking