Can I Take A Mudra Loan From Two Banks

No, you cannot take two active MUDRA loans from two different banks simultaneously for the same business purpose. The MUDRA loan scheme under PMMY allows only one active loan at a time for a single enterprise. However, if you have successfully repaid your previous MUDRA loan, or if your business requires additional funds and justifies the expansion, you may be eligible to apply for another MUDRA loan (from the same or another bank), subject to the lender’s discretion. 

What Is a MUDRA Loan? 

The Pradhan Mantri MUDRA Yojana (PMMY) was launched in 2015 to offer financial support to micro and small enterprises, particularly in the non-corporate, non-farm sector. These loans are provided through: 

• Banks 

• NBFCs 

• MFIs 

• Cooperative banks 

Three Categories of MUDRA Loans: 

Can You Take Two MUDRA Loans from Two Banks? 

No, You Cannot Have Two Active MUDRA Loans at the Same Time 

The MUDRA scheme guidelines do not allow borrowers to have multiple MUDRA loans simultaneously. This is because: 

• The loan is meant to support one business activity. 

• All MUDRA loans are tracked through credit bureaus. 

• The government aims to ensure responsible borrowing by avoiding misuse, duplicate loan applications, or excessive financial burden on small business owners. 

If two banks were to unknowingly sanction MUDRA loans to the same borrower, it would create a compliance violation. 

When Can You Take Another MUDRA Loan? 

You can apply for another MUDRA loan under the following conditions: 

1. After Repayment of the First Loan 

If you have taken and fully repaid a MUDRA loan from Bank A: 

• You can apply for another loan from Bank A or Bank B. 

• The second loan can be of a higher category (e.g., moving from Shishu to Kishor). 

2. Business Expansion Requires Additional Funding 

If your business has grown and you need additional working capital: 

• You may be eligible for a top-up loan or an enhanced loan under a higher category (e.g., Shishu to Tarun). 

• The lender will evaluate your business’s revenue, financial stability, and ability to repay the loan before approving additional funding.

3. You Have Multiple Businesses (Rare Case) 

If you own two completely separate registered businesses: 

• You may apply for separate MUDRA loans, each linked to a distinct business, but approval depends on bank discretion and thorough verification. 

What Happens if You Try to Take Two Loans Simultaneously? 

• Banks use CIBIL and other credit bureaus to check your loan history. 

• Applying for MUDRA loans at two banks simultaneously may trigger rejection due to duplicate detection during credit checks. 

• One or both banks may detect the existing application or loan. 

• Your application will be rejected or put on hold. 

• Any attempt to hide the existing loan or use different credentials (PAN, Aadhaar, mobile number) can be considered fraud, leading to: 

• Loan disqualification 

• Penalties 

• Legal action 

• Blacklisting from further credit access 

Example Scenarios 

✅ Valid Case: 

Ravi took a Shishu loan of ₹50,000 from SBI in 2022. He repaid it by 2024. In 2025, he applies for a Kishor loan of ₹3 lakh from HDFC Bank for business expansion. Approved ✅ 

❌ Invalid Case: 

Meena takes a MUDRA loan from Bank of Baroda and simultaneously applies for another from PNB for the same business using the same PAN/Aadhaar. Application flagged by credit check. Rejected ❌ 

The MUDRA scheme is designed to support micro and small entrepreneurs responsibly. While you cannot take two MUDRA loans from different banks simultaneously, you can apply again once you repay the existing loan or show justified business expansion needs. Always maintain transparency with lenders, avoid misrepresentation, and build a strong repayment record for better loan opportunities in the future.