Mudra loan rejected? File one RTI to find out why

Sharath applied for a ₹4 lakh Kishore loan to expand his small electronics shop in Hyderabad. Branch said “sorry, doesn't qualify”. No written rejection.

He filed an RTI to SBI's Banking Ombudsman PIO + branch parallel. 18 days later the response cited his CIBIL score of 580 + lack of GSTIN as reasons. He fixed both, reapplied, got the loan in 6 weeks.

Mudra is administered by Mudra Ltd (a SIDBI subsidiary) with last-mile execution by PSBs / RRBs / NBFCs / MFIs. PSBs are public authorities under RTI; private banks have limited RTI applicability via the RBI's regulatory disclosure framework.

• §6(1) RTI Act.
• §7(1) — 30 days.
• PMMY Operational Guidelines — banks must give written rejection with reasons.
• RBI Master Circular on Lender's Liability (latest 2024) — written rejection within 30 days mandatory.
• Banking Codes and Standards Board (BCSBI) — service standards.

To,
The Public Information Officer (PIO),
[Bank Name] Branch [Name] / SIDBI / RBI Banking Ombudsman,
[Address]

Subject: §6(1) RTI Act 2005 — rejection of PMMY Mudra loan
         application

Sir/Madam,

   Applicant name : [Full name]
   Loan reference : [Branch application reference]
   Application date: DD-MM-YYYY
   Mudra category : Shishu / Kishore / Tarun
   Amount sought  : ₹___
   Purpose        : [Business activity]

Please provide:

   1. Written reasons for rejection of my Mudra loan.
   2. Copy of the rejection letter/note (PMMY Operational
      Guidelines mandate written rejection).
   3. Documentation deficiency (if any) and corrective procedure.
   4. CIBIL/credit-score threshold applied (per bank policy).
   5. Branch's PMMY portfolio target vs achievement for this FY.
   6. Number of PMMY rejections + appeal procedure to controlling
      office.
   7. Name + designation of dealing officer + branch manager.

Citizen of India. Fee: ₹10 IPO/DD enclosed.

[Name + signature + address + date]

- File parallel RTIs: branch + RBI Banking Ombudsman + SIDBI (Mudra PIO). - ₹10 fee at each. - 30-day deadline. - First Appeal → controlling office; Second Appeal → CIC.

Ask for branch FY target vs achievement. CIC has held this is not §8 ground for rejection.

Ask for the specific missing docs + bank's checklist.

Ask for the bank's specific threshold for Mudra Shishu (no CIBIL needed) vs Kishore/Tarun.

PMMY Shishu has no collateral; ask for interest rate as per RBI MCLR.

File with the NBFC + parallel RBI grievance.

- CIC, Mudra v. SIDBI (2019) — SIDBI directed to disclose state-wise rejection statistics. - Banking Ombudsman v. Customer (NCDRC 2020) — Customer entitled to written rejection.

First Appeal → bank's controlling office; second to CIC.

Limited; via RBI's regulatory framework.

Violation of PMMY guidelines. RTI exposes.

Mudra is a flagship scheme; rejections without reasons are regulatory violations. RTI gives you the documentary base for redressal.

File the RTI.

- RTI Act 2005 — §6(1), §7(1). - PMMY Operational Guidelines. - RBI Master Circular on Lender's Liability. - CIC Mudra v. SIDBI (2019).

Last reviewed: 24 April 2026.

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