Pradhan Mantri Street Vendor’s Atmanirbhar Nidhi is a special micro-credit facility scheme for providing affordable loans to street vendors. The scheme enabled the street vendors to resume their livelihoods that have been adversely affected due to COVID-19 lockdown. The scheme was launched in pursuance of the announcement made by the Finance Minister Nirmala Sitharaman last month.
In India’s history, it is for the first time that street vendors from peri-urban or rural areas have become beneficiaries of an urban livelihood program.
The rationale behind the scheme is to provide working capital loans to street vendors. As we know that street vendors usually work with a small capital base which that might have consumed during the lockdown period. So, the scheme will be helpful to resume their livelihoods.
The street vendor’s played an important role in providing the availability of the goods and services at affordable rates at the door-step of the city dwellers.
Who are Street Vendors/Hawkers?
Any person who works in vending of articles, goods, wares, food items or merchandise of daily use or offering services to the general public during a street, footpath, pavement, etc. from either a temporary built-up structure or by moving from one place to another. The goods that are supplied by them are vegetables, fruits, ready-to-eat street food, tea, pakodas, bread, eggs, textile, artisan products, books/ stationery, etc. and the services include barbershops, cobblers, pan shops, laundry services, etc.
PM SVANidhi Scheme: Objectives
To provide working capital loans up to Rs 10,000 at a subsidized rate of interest.
To incentivize the regular repayment of a loan.
Also, to reward digital transactions.
The target beneficiaries of the scheme are:
The scheme targets to benefit over 50 lakh street vendors, who had been vending on or before 24 March 2020 in urban areas. As beneficiaries, the street vendors belonging to the surrounding peri-urban or rural areas are also included under the urban livelihoods program for the first time.
PM SVANidhi Scheme: Salient Features
Initial working capital of up to Rs 10,000.
In monthly installments, the loan is repayable in the tenure of one year.
Interest subsidy @7% on timely/early repayment. That is on the timely and early repayment of the loan, an interest subsidy @ 7% per annum will be credited to the bank accounts of the beneficiaries through Direct Benefit Transfer on a six-monthly basis.
On digital transaction incentives of monthly cash-back.
On the timely repayment of the first loan, there will be higher loan eligibility. That is if the street vendor repays the installments on time or earlier will develop a credible credit score then he or she will be eligible for a higher amount of term loan to Rs 20,000.
PM SVANidhi Scheme: Tenure
The tenure of the scheme or the scheme shall be implemented up to March 2022.
The lending institutions under the scheme are:
In the implementation of the scheme, the Urban Local Bodies will play a significant role. The lending institutions under the scheme are Scheduled Commercial Banks, Regional Rural Banks, Small Finance Banks, Cooperative Banks, NBFCs, Micro Finance institutions, and Self Help Group banks.
Mobilizing technology for the empowerment:
The Government’s vision of supporting technology is to ensure effective delivery and transparency. And for this, a digital platform with a web portal/mobile app is being developed to administer the scheme with end-to-end solutions.
In integrating the vendors the IT platform will also help into the formal financial system.
To administer interest subsidy automatically, the platform will integrate the web portal/ mobile app with the UdyamiMitra portal of SIDBI for the credit management and PAiSA portal of MoHUA.
PM SVANidhi Scheme: Focus on capacity building
A capacity building and financial literacy program of all the stakeholders and IEC activities throughout the country will also be launched by MoHUA in collaboration with State Governments, State Missions of DAY-NULM, ULBs, SIDBI, CGTMSE, NPCI, and Digital Payment Aggregators during the month of June and loaning will commence in the month of July.
The scheme will help the street vendors to kick-start their businesses who have been finished with the money in the lockdown period during COVID-19 pandemic.