However, when she approached the State Bank of India’s Jalahalli East branch for a loan of Rs. 50,000 under the PMMY, she was turned away on the ground that she doesn’t possess an Aadhaar ID.

With the Supreme Court stating that no benefit be denied to a citizen based on Aadhaar card, the SBI’s approach of allegedly making it mandatory for the Prime Minister’s loan scheme for small enterprises has come as a shocker.

Other major nationalised banks, including Vijaya Bank, Andhra Bank and State Bank of Travancore, have not made Aadhaar mandatory for the loan scheme.

According to A.M. Muthillath, chairperson of NGO Sarwajan Bharat, officials in SBI branches claimed to have received a circular from their headquarters not to process PMMY applicants who don’t have Aadhaar. “The move to turn down applications is strictly against the directive of the Supreme Court and the government must take action with immediate effect,” he added.

However, SBI sources in Bengaluru said that insistence on Aadhaar is to prevent multiple borrowing under PMMY. “We are insisting on Aadhaar to keep a check on the beneficiaries and avoid misappropriation. SBI has insisted that at least an acknowledgement of an Aadhaar application will be necessary for the loan process,” said a senior officer with SBI, Bengaluru.