PM SVANidhi is Central Sector Scheme, launched by the Ministry of Housing and Urban Affairs on June 01, 2020.
Purpose: To provide affordable Working Capital loans to street vendors to resume their livelihoods that have been adversely affected due to the Covid-19 lockdown.
It is a micro-credit facility that provides street vendors with a collateral-free loan of Rs 10,000 with low rates of interest (below 12%) for a period of one year, aiding the vendors in getting back on their feet financially.
In the long term, it aims at –
Establishing a credit score for the vendors
Creating a digital record of their socio-economic status.
This will enable street vendors to avail the Central government schemes later, formalise the informal sector of the economy and provide them safety nets and a means of availing loans in the future.
The duration of the scheme initially was until March 2022. It has been extended till December 2024, with a focus on enhanced collateral-free affordable loan corpus, increased adoption of digital transactions and holistic socio-economic development of the Street Vendors and their families.
Lending Agencies:
Microfinance Institutions, Non-Banking Financial Company, Self Help Groups have been allowed due to their ground level presence and proximity to the urban poor including the street vendors.
Eligibility:
The Scheme is available to all street vendors engaged in vending in urban areas.
Earlier the Scheme was available to all street vendors engaged in vending on or before March 24, 2020.
As per the Street Vendors Act 2014, the Town Vending Committees (which comprises the local authorities and vendors from an area) issue a certificate of vending after a survey has been conducted of all the vendors.
States/Union Territories (UTs):
The Scheme is available for beneficiaries belonging to only those States/UTs which have notified Rules and Scheme under Street Vendors (Protection of Livelihood and Regulation of Street Vending) Act, 2014.
Beneficiaries from Meghalaya, which has its own State Street Vendors Act may, however, participate.
Performance of the scheme:
Data on the PM-SVANidhi portal (February 10, 2024) showed that 60.65 lakh first-term loans, 16.95 lakh second-term loans and 2.43 lakh third-term loans have been disbursed so far under the scheme.
PM SVANidhi Scheme Benefits
Vendors can avail of a working capital loan of up to Rs. 10,000, which is repayable in monthly instalments in the tenure of one year.
On timely/ early repayment of the loan, an interest subsidy @ 7% per annum will be credited to the bank accounts of beneficiaries through Direct Benefit Transfer on a quarterly basis. Here will be no penalty on early repayment of loan.
On timely repayment of the first loan, higher loan eligibility of Rs.20,000 and Rs.50,000 in the second and third tranches respectively.
The scheme promotes digital transactionsthrough cash back incentives up to an amount of Rs. 100 per month (i.e. INR 1200/- per annum).
The vendors can avail the facility of escalation of the credit limiton timely/ early repayment of loan.
Implementation agency: Small Industries Development Bank of India (SIDBI).
Along with the Ministry of Housing and Urban Affairs, the Small Industries Development Bank of India (SIDBI)will be implementing the scheme.
Urban Local Bodies (ULBs): Helps beneficiaries by reaching them to connect under the scheme efficiently.
E-governance:
Encourage Digital Transactions:
The scheme incentivises digital transactions by the street vendors through monthly cash back.
Transparency:
In line with the vision of leveraging technology to ensure effective delivery and transparency, a digital platform with web portal/ mobile app is being developed to administer the scheme with end-to-end solution.
This platform will integrate the web portal/ mobile app with UdyamiMitra portal of SIDBI for credit management and PAiSA portal of MoHUA to administer interest subsidy automatically.
Financial Inclusion:
It will help in integrating the vendors into the formal financial system.
Focus on Capacity Building:
MoHUA in collaboration with State Governments will launch a capacity building and financial literacy programme of all the stakeholders and Information, Education and Communication (IEC) activities throughout the country.
Who is a Street Vendor/hawker?
Any person engaged in vending of articles, goods, wares, food items or merchandise of daily use or offering services to the public in a street, footpath, pavement etc., from a temporary built up structure or by moving from place to place.
The goods supplied by them include vegetables, fruits, ready-to-eat street food, tea, pakodas, breads, eggs, textile, apparel, artisan products, books/ stationary etc. and the services include barber shops, cobblers, pan shops, laundry services etc.
Around 49.48 lakh street vendors have been identified in India.
Uttar Pradesh has the maximum at 8.49 lakh, followed by Madhya Pradesh at 7.04 lakh.
