PM SVANidhi Scheme: Objectives, Salient Features, Tenure and Key facts
Pradhan Mantri Street Vendor's Atmanirbhar Nidhi is a special micro-credit facility scheme for providing affordable loan 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 programme.
The rationale behind the scheme is to provide working capital loan to the 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, breads, 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 loan up to Rs 10,000 at a subsidised rate of interest.
- To incentivise 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 programme for the first time.
PM SVANidhi Scheme: Salient Features
- Initial working capital of up to Rs 10,000.
- In monthly instalments, the loan is repayable in the tenure of one year.
- Interest subsidy @7% on timely/early repayment. That is on 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 six-monthly basis.
- On digital transactions incentives of monthly cash-back.
- On timely repayment of the first loan, there will be higher loan eligibility. That is if the street vendor repays the instalments on time or earlier will develop 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.
What is the role of Urban Local Bodies (ULBs)?
As discussed above ULBs will play a significant role and ensures to target the beneficiary and reach to them in an efficient manner.
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 solution.
- 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 UdyamiMitra portal of SIDBI for credit management and PAiSA portal of MoHUA.
PM SVANidhi Scheme: Focus on capacity building
A capacity building and financial literacy programme 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.