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**Trump Shifts Student Loan System to Small Business Administration**
*Published: March 21, 2025, 5:42 PM ET*
**Main Ideas:**
* President Donald Trump declared on Friday that the Small Business Administration (SBA) would assume control of the nation’s federal student loan holdings as a component of his strategy to dismantle the Department of Education.
* The SBA is also contracting, declaring a 43% decrease in personnel on the same day it acquires the $1.6 trillion loan portfolio.
* Trump asserts this action will enhance student loan servicing, despite facing disapproval from certain student loan borrower advocacy organizations. Solana Co-Creator Anatoly Yakovenko Says Layer 2 Solutions are Unnecessary
If you’re among the 43 million Americans with student loan obligations, you could soon be submitting payments to the Small Business Administration instead of the Department of Education, as part of President Trump’s newest restructuring of the federal government.
Trump declared on Friday that the SBA, a department that assists small enterprises through loans and other initiatives, would manage the country’s $1.6 trillion student loan debt portfolio as part of his endeavor to abolish the Department of Education. Presently, the Department of Education oversees these loans, depending on private servicing firms to manage payments and customer assistance.
“We possess a substantial portfolio, numerous loans, thousands and thousands of loans – highly complex arrangements. This will be removed from the Department of Education promptly, and it will be serviced much more effectively than it has been. It’s been a disaster,” Trump mentioned Friday in the Oval Office.
On the same day, SBA Administrator Kelly Loeffler announced that the new location for the loan portfolio was reducing its workforce by 43%.
Loeffler shared on X, “As the government’s foremost guarantor of business loans, the SBA is prepared to utilize its resources and proficiency on behalf of American taxpayers and students.”
Pupil loan debtors have encountered difficulties recently, with their regular installments periodically taking off under salary-pushed reimbursement plans. This happens in the midst of warmed legitimate conflicts over the destiny of the SAVE reimbursement plan made by President Biden’s organization.
Mike Pierce, chief overseer of the Pupil Borrower Security Center, expressed that moving the understudy loan program to the Private venture Organization is illicit and not kidding, an unmistakable endeavor to divert from the way that Trump has subverted the understudy loan framework and is effectively estranging a large number of borrowers.
This move has drawn analysis from no less than one understudy loan borrower promotion gathering.
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