1. What is the scheme?
To rescue the street vendors who have been hit hard due to the Wuhan Virus pandemic and the nation wide lockdown, the PM SVANidhi scheme was launched as part of the Atma Nirbhar movement, that aims to provide financial assistance to nearly 50 lakh street vendors in urban, peri-urban and rural areas areas who were vending till March 24, 2020.
Vendors will have access to collateral-free working capital loan up to ₹10,000. The scheme is valid till March 2022.
This is a Central Sector Scheme to facilitate street vendors to access affordable working capital loan for resuming their livelihoods activities, after easing of lockdown.
2. What is the rationale of the scheme?
The scheme will help vendors who make their living by selling food or running a cobbler shop on footpaths to kickstart their business in the post lockdown period. They usually work with a small capital base, which they might have consumed during the lockdown. Therefore, credit for working capital to street vendors will be helpful to resume their livelihoods. This scheme will allow vendors to access formal modes of credit rather than through informal sources like moneylenders who charge usurious interests.
3. Which lending institutions will provide credit?
Scheduled Commercial Banks, Regional Rural Banks, Small Finance Banks, Cooperative Banks, Non-Banking Financial Companies, Micro-Finance Institutions and SHG Banks.
4. What are the salient features of the Scheme?
i) Initial working capital of up to ₹10,000/-.
(ii) Interest subsidy on timely/ early repayment @ 7%.
(iii) Monthly cash-back incentive on digital transactions – an amount of ₹ 100 per month
(iv) Higher loan eligibility on timely repayment of the first loan.
5. Who is the target beneficiary for the Scheme?
Street vendors/ hawkers vending in urban areas, as on or before March 24, 2020, including the vendors of surrounding peri-urban and rural areas.
6. Who is a street vendor/hawker according to the scheme?
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.
Prime Minister Narendra Modi on September 9 interacted with some of the beneficiaries of the scheme. So far, over 10 lakh applications have been received, of which loans for over 3.4 lakh have already been sanctioned.