The Prime Minister Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) is a Central Sector Scheme launched by the Ministry of Housing and Urban Affairs (MoHUA) to provide affordable working capital loans to street vendors. This scheme aims to facilitate the resumption of livelihood activities for street vendors after the easing of lockdown restrictions due to the COVID-19 pandemic. PM SVANidhi is designed to empower street vendors by providing them with the necessary financial support to restart and sustain their businesses.
Objectives of PM SVANidhi
The primary objectives of the PM SVANidhi scheme are:
- To facilitate access to affordable working capital loans for street vendors.
- To help street vendors resume their livelihood activities after the lockdown.
- To promote digital transactions and financial inclusion among street vendors.
- To provide incentives for regular repayment of loans.
- To create a comprehensive database of street vendors for better planning and policy formulation.
Key Features of PM SVANidhi
- Eligibility: The scheme is available to all street vendors engaged in vending in urban areas as on or before March 24, 2020. The eligible vendors are identified as per the criteria mentioned in the Street Vendors (Protection of Livelihood and Regulation of Street Vending) Act, 2014.
- Loan Amount: Street vendors can avail of a working capital loan of up to Rs. 10,000, repayable in monthly installments over a tenure of one year.
- Interest Subsidy: The scheme provides an interest subsidy of 7% per annum on regular repayment of the loan. The interest subsidy amount will be credited to the borrower’s bank account quarterly.
- Digital Transactions Incentive: The scheme promotes digital transactions through cashback incentives. Vendors can earn monthly cashbacks up to Rs. 100 on undertaking digital transactions using the prescribed digital payment methods.
- No Collateral: The loans provided under PM SVANidhi are collateral-free, making it easier for street vendors to access credit.
- Credit Score Improvement: Regular repayment of the loan helps in improving the credit score of the vendors, making them eligible for higher amounts of term loans in the future.
How to Apply for PM SVANidhi
Street vendors can apply for the PM SVANidhi scheme through the following steps:
- Identify Lenders: The scheme is implemented through Scheduled Commercial Banks, Regional Rural Banks (RRBs), Small Finance Banks (SFBs), Cooperative Banks, Non-Banking Financial Companies (NBFCs), and Microfinance Institutions (MFIs). Vendors can approach any of these lending institutions to apply for the loan.
- Submit Application: Vendors can submit their loan application either online through the PM SVANidhi portal or offline by visiting the nearest branch of the lending institution. The application should include necessary documents such as identity proof, address proof, and vendor certificate or ID card issued by the Urban Local Body (ULB).
- Verification and Approval: The lending institution will verify the application and documents. Upon successful verification, the loan will be sanctioned and disbursed to the vendor’s bank account.
- Repayment: Vendors need to repay the loan in monthly installments over a tenure of one year. Regular repayment will make them eligible for the interest subsidy and other incentives.
Benefits of PM SVANidhi
The PM SVANidhi scheme offers several benefits to street vendors, including:
- Financial Support: Provides essential working capital to street vendors, enabling them to restart and sustain their businesses after the lockdown.
- Interest Subsidy: Offers a 7% interest subsidy on regular repayment of the loan, reducing the overall cost of borrowing for the vendors.
- Digital Inclusion: Promotes digital transactions through cashback incentives, fostering financial inclusion and digital literacy among street vendors.
- Collateral-Free Loans: The loans are collateral-free, ensuring easy access to credit for street vendors without the need for any security or guarantee.
- Credit Score Improvement: Regular repayment of the loan helps improve the credit score of vendors, making them eligible for higher amounts of term loans in the future.
Impact of PM SVANidhi
Since its launch, the PM SVANidhi scheme has had a significant impact on the lives of street vendors:
- Economic Revival: The scheme has provided much-needed financial support to street vendors, helping them restart their businesses and contribute to the economic revival of urban areas.
- Digital Transformation: By promoting digital transactions, the scheme has encouraged street vendors to adopt digital payment methods, enhancing their financial inclusion and literacy.
- Improved Credit Access: The collateral-free loans and interest subsidy have improved access to credit for street vendors, enabling them to meet their working capital requirements without any financial burden.
- Enhanced Livelihood: The financial assistance provided under the scheme has helped street vendors sustain their livelihoods and improve their overall quality of life.
Challenges and the Way Forward
Despite its successes, the PM SVANidhi scheme faces several challenges that need to be addressed to enhance its effectiveness:
- Awareness: Increasing awareness about the scheme among street vendors is crucial for higher participation. Outreach programs and campaigns can help educate potential beneficiaries about the scheme’s benefits and application process.
- Ease of Access: Ensuring easy access to lending institutions, especially in remote and underserved areas, can encourage more street vendors to avail of the scheme.
- Technology Integration: Leveraging technology to streamline the application, verification, and disbursement processes can enhance the scheme’s efficiency and reach.
- Continuous Monitoring: Implementing robust monitoring and evaluation mechanisms to track the progress of the scheme and address any issues or challenges that may arise.
Conclusion
The Prime Minister Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) is a transformative initiative that provides critical financial support to street vendors in India. By facilitating access to affordable working capital loans, the scheme empowers street vendors to resume and sustain their livelihood activities after the lockdown. With continued efforts to address challenges and enhance its reach, the PM SVANidhi scheme has the potential to significantly impact the economic development and financial inclusion of street vendors across the country.
