Introduction

How many times a day do we hear a howl from the streets calling to buy a range of things that starts with food items and vegetables and goes on till infinite other stuff like cotton for pillows or doormats or cutleries or cotton-candies? I am sure plenty.

Living in India has its own charms, for example, a lot of us have one such beautiful memory of our childhood when on the way of coming home from schools or playgrounds, in the broad hot afternoons, we used to stop to buy ice-creams or kulfis or those frozen lumps of flavored ice from that stall at the corner of our locality. Oh! The simple pleasures of life! No matter where we live in this country, this one thing will always be relatable.

It was everywhere, streets, railway stations, trains, bus stops, busses, markets, tourist attractions and the list goes on.

But ironically what gave us such treasures of memories are often left unnoticed. Who were the ones selling them? How many of them took it as a profession and raised the informal economy of the country? What are they doing now?

What began in 2020, turned out to be a disaster in just a few months, the whole world endured a common fear of the worst and went into lockdown. Today, even after more than a year, we’re in partial lockdown. Streets are closed, India stands still. But what about those street sellers and vendors whose lives depended on those streets? How are they surviving this ‘halt’ in life? 

One thing that can never be underestimated or doubted is the contribution of these people who take up the jobs of delivering our basic needs right to our doorsteps in the cheapest way possible towards the ultimate goal of the renounced Make in India Campaign.

And finally, the time has come when the widely unnoticed ones are looked upon and thought of. On June 1, 2020, amidst the fearsome outbreak of Novel Coronavirus, the Ministry of Housing and Urban Affairs announced the launch of the much-awaited and needed PM Street Vendor’s AtmaNirbhar Nidhi, or as we commonly call it PM SVANidhi Scheme.

The main motive of this scheme is to provide credits for the working capital to the street vendors of the country wherein they can take loan for one year, collateral-free and at low-interest rates to resume their businesses and help in these dire times of need.

Features of PM SVANidhi Scheme

• To begin with, it is a Central Sector Scheme, meaning, they are funded directly by the central ministries.
• The scheme will be implemented till March, 2022.
• Any urban vendors as well as the ones working in the surrounding rural and semi-urban areas on or before March 24. 2020 will be eligible to apply for the loans.
• Initially a working capital of Rs. 10,000 will be provided.
• On timely or early repayment of which, the vendor shall be provided with an Interest Subsidy of 7%. Along with it, those vendors will also be granted higher loan amounts in the preceding transactions.
• To promote Make in India and Digital Transactions, the vendors shall be provided with monthly cash back incentives. These cashback ranges from Rs. 50 to Rs 100.
• The loans are completely collateral-free.

Objectives of PM SVANidhi Scheme

To unleash its full capacities, these loans are kept simple with profitable and helpful objectives that reach the masses and are easily understandable. The potentials of these loans are so much so that it cannot just help the ones in need but also secure their near future and implement the use of technology.

• Working capital loan: the prime objective of this scheme is to provide a working capital loan of Rs. 10,000 at subsidized rates of interest to anyone and everyone eligible.
• Digital Transactions are rewarded: this creates an awareness, helps to maintain safety protocols in the times of a virus outbreak, brings everyone to the same platform and at the same time rewards the vendors with cashback that helps them financially and encourages the deepest and most rooted citizens of the country to take a step towards Digitalization.
• Incentivize regular loan repayment: the lives of daily wagers are not easy, taking a loan may help their situations but repaying those same becomes a nightmare in their lives. Incentivizing the timely loan repayment encourages them morally and at the same time makes the process a lot easier, beneficial and cost-efficient.

List of Lending Institutions

To reach the general masses, banks have been chosen wisely and specifically. Here’s a list of all the lending institutions partnered with the scheme:

1. Scheduled Commercial Banks
2. Small Finance Banks (SFBs)
3. Regional Rural Banks (RRBs)
4. Cooperative Banks
5. Self-help group Banks (SHG)
6. Micro Finance Institutions (MFIs)
7. Non-Banking Financial Companies (NBFCs)

Eligibility Criteria for PM SVANidhi Scheme

Although the loan is available for all the street vendors active on and before 24th March, 2020, here’s a list of criteria that identifies the eligible candidates:

• Only the street vendors recognized by the ULBs or Urban Local Bodies and/or the ones possessing the Certificate of Vending or ULB issued Identity card.
• The Vendors who have been recognized in the survey but haven’t received a Certificate or Identity card will be provided with a Provisional Certificate of Vending. As per the Government’s request, those vendors will be provided with permanent identification cards by the ULBs with immediacy.
• Those street vendors without the above-mentioned identification can also become eligible by having issued a Letter of Recommendation (LoR) by the ULB or TVC (Town Vending Committee)
• The vendors residing and active in the surrounding peri-urban or rural areas can also become eligible by having the same letter of recommendation by ULB or TVC
• ULB/TVC Verified vendors who left their area of operation due to COVID-19 (prior to or during) will be eligible for the loan after they come back and resume their businesses.

Documents Required by the ULBs to Generate LoR

For the candidates left out of surveys completely and/or are from the surrounding Rural Areas, here’s the list of documents that will be required to get LoR by the ULB and TVC:

• ULB application form with candidate details
• Membership details of those individuals with any of these:
  • National Association of Street Vendors or India (NASVI)
  • National Hawkers Federation (NHF)
  • Self-Employed Women’s Association (SEWA)
• Any possession of supporting documents that claim the individual’s vending career
• Report of local inquiries conducted by TVC or ULB involving community-based organizations and/ or Self-Help Groups (SHGs)

The ULBs are to verify the candidates within 15 days of submission of application by the candidate.

Rate of Interest

Interest Subsidy

Every financial year is divided quarterly and each quarter ends on June 30, September 30, December 31 and March 31. On these mentioned days, the lenders will have to submit claims for the interest subsidies and all the vendors availing the loan under SVANidhi Scheme will become eligible for a 7% interest subsidy which then will be transferred directly to their bank’s account. However, here are certain points that one will need to keep in mind:

• In case of early repayment, the subsidy shall be credited to the borrower’s account in one go.
• The subsidy will be available till 31st March, 2022 and on the first and thereafter subsequent amplified loans till the given date.
• The subsidy will only be accepted in respect of Standard (non-NPA) accounts of the borrowers and only in the months of the concerned quarters where the account remains Standard.

Credit Guarantee

The scheme not only thinks about the vendors but also of the lenders by providing credit risk mitigation to the lenders for all the loans sanctioned which is administered by Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE). This will be operated on a portfolio basis wherein the periodicity of lending institutions filing claims will be quarterly. Here are more details on the portfolio:

• For up to 5% first loss default: 100%
• For beyond 5% up to 15% second loss: 75% of default portfolio
• A maximum of 15% of the year portfolio will be given as a guarantee coverage.

Promotion of Digital Transactions

With the help of a cashback facility, this scheme is all set to promote digital transactions that spread awareness to the core of the masses and be beneficial to them at the same time. Another huge benefit of vendors for using digital transactions as a method of payment, apart from getting cashback and maintaining safety during a pandemic is building a credit score with each usage.

This scheme deals with people who usually are not as aware of the benefits of credit scores. Eventually, when they take loans, it turns out to be not very cost-efficient. This method not just educates them about the system but also builds one as they use it.

In the present day, everyone owns a smartphone and everyone is accessible to the internet, therefore it becomes easier to implement it and metastasize the scheme. Here’s a list of the commonly preferred digital payment aggregators and lending institutions:

• NPCI (BHIM)
• PayTM
• GooglePay
• AmazonPay
• PhonePe
• BharatPe

When we talk of these aggregators, they in themselves are very rewarding. But keeping that aside from the scheme also provides cashback based on the following terms:

• Each payment to be eligible needs to be of and above Rs. 25
• On making 50 eligible digital transactions in a month the cashback amount will be Rs. 50
• On making the next 50 such transactions in the same month (i.e., 100) the cashback amount will be Rs. 75
• On making the next 100 transactions in the same month (i.e., 200) the cashback amount will be Rs. 100.

How to Apply for the SVANidhi Scheme

To apply for loans under SVANidhi Scheme, all the eligible street vendors need to address a Banking Correspondent or any Agent of MFIs of their areas. Common Service Centre (CSC) built up that helps the vendors all throughout the application process. The ULBs have a list of all the identified street vendors and this personnel will guide the registered/ identified vendors in accordance with the lists through the application process.

There are two ways for applying, one through the mobile app and another through the portal – https://pmsvanidhi.mohua.gov.in/. One can apply directly or with the help of the above-mentioned assisting bodies. It is important for one to check and verify the status of their eligibility before approaching any facilities to avoid crowds during the pandemic.

Documents Required for Application

For easier accessibility, the documents required for applying for this loan are kept very simple and hassle-free. Here’s the list of documents you’ll be needing during the application process:

• Certificate of Vending/ Identity card/ Letter of Recommendation issued and verified by the ULB or TVC
• Identity Proof and Address Proof by any one of the following:

Why choose SVANidhi Scheme?

Starting a business is comparatively easier than restarting one. The recent conditions due to the pandemic have left the industries shattered and disintegrated. But at the same time, there’s a huge need for essential materials arising as well.

This calls for new opportunities and bigger growing spaces. With the working capital loans provided by PM SVANidhi Scheme, the street vendors get the elbow room to re-start their businesses and flourish in the market. These loans, which by now we know, are rewarding, beneficial, cost-efficient and let the vendors resume their lives on a positive and tension-free note.

If we look at the numbers, a total of 41,66,224 applications have been submitted among which 24,05,408 have been sanctioned. The total amount disbursed is 20,52,432.

Therefore, it can be assured that this scheme is, with time and due course, reaching the right masses in the right possible way.

PM SVANidhi Scheme FAQs:

PM SVANidhi News

Over 30 Lakhs Loans Disbursed Under PM’s SVANidhi Scheme

As per government data, the number of beneficiaries under the PM SVANidhi microcredit scheme crossed the mark of 30 lakhs. In June 2020, the scheme was introduced to provide no-security loans up to Rs 10000 for a tenure of 1 year to nano entrepreneurs. Repayment within time ensures a loan up to 20000 in the second tranche and the third tranche up to Rs 50000. Until March 2022, 33.38 loans were sanctioned involving more than 3000 crores. An interest subsidy of 7% is also available under this scheme.

Uttar Pradesh topped in disbursement count while the financial institutions were the top lenders. However, the government intended to achieve this target of 30 lakhs within only 12 months, yet it took two years.

News Updated Date: 05-04-2022

Over 26 lakh beneficiaries availed of working capital loan under the PM SVANidhi scheme

The total number of beneficiaries who have availed of the working capital loan under the PM SVANidhi Scheme is 26,37,266 as of November 25, 2021.

Under Prime Minister Street Vendor’s Atma Nirbhar Nidhi, the number of loans sanctioned but not disbursed is 3,21,504.

The minister of State in the Ministry of Housing and Urban Affairs, Kaushal Kishore, informed Rajya Sabha on Monday that the total number of accounts with more than three months delay between sanctioned loans and loan disbursed is 2,46,238. 

Reasons behind the gap are: 

• The Lending Institutions & the Urban Local Bodies are not well coordinated 
• Street Vendors frequently change their mobile numbers 
• Street Vendors do not visit the bank branches for documentation formalities

Ministry regularly conducts review meetings with the Lending Institutions and Urban Local Bodies to facilitate the process and accelerate the disbursement of sanctioned loans.

Updated Date: 03-01-2022

PM SVANidhi: Loans issued are up 9 per cent year on year, while applications approved are up 11 per cent

As of November 28, 2021, 26.68 lakh loans totaling Rs 2,668.52 crore have been disbursed, up from 24.48 lakh loans totaling Rs 2,426.47 crore on August 29, 2021, and 20.65 lakh loans totaling Rs 2,045 crore on June 3, 2021. The initiative offers 12-month working capital loans of up to Rs 10,000 to street vendors, including hawkers selling fruits, vegetables, tea, footwear, local foods, books, and so on. As of November 28, 2021, 30 lakh loans of Rs 3,037.83 crore have been sanctioned, according to statistics on the scheme’s homepage. It represented a more than 11% increase over the 26.98 lakh applications worth Rs 2,696.26 crore that had been approved as of August 29, 2021. So far, 49.45 lakh applications have been received. 

While the initiative had originally planned to issue 30 lakh loans in its first year, due to a lockdown and other limitations in April and May of this year following the second Covid wave, it was only able to approve almost 21 lakh applications. Sanjay Kumar, Joint Secretary, Ministry of Housing and Urban Affairs, had told Financial Express Online that 30 lakh was a lofty goal. So far, about 60% of borrowers in the plan have been men, while 41% have been women.

Updated Date: 14-12-2021

Government to introduce Rs 25,000 loan to street vendors under PM SVANidhi Scheme

The Modi government is planning to introduce an extension in the flagship credit scheme to street vendors. This extension will be added to the PM Street Vendor Atmanirbhar Nidhi. The second version of this scheme will be introduced in order to bring cash flow to the market during the festive season. 

PM SVANidhi had already introduced the relief measures in June 2020 when the Covid19 pandemic hit India. Revised guidelines increased the capital loan limit from Rs 10,000 to Rs 25,000. The Government has also increased the guarantee on loans to 25% from the current 15%. This scheme will be sponsored by the Ministry of Housing and Urban Affairs (MoHUA), and each borrower will be entitled to a 7% interest subsidy. Although it will have minimal impact on the economy, the Government is looking at it as a boost. 

Street vendors active before March 24, 2020, are eligible for the loan of Rs 10,000 with one year of the repayment period. The new development is estimated to bring sellers to legitimate creditors.

Updated Date: 15-11-2021

28% beneficiaries of PM Svanidhi scheme from Uttar Pradesh

The Pradhan Mantri Street Vendors Atma Nirbhar Nidhi Scheme was introduced in June 2020 to facilitate working capital loans to the street vendors in urban areas whose businesses and daily income were affected by the pandemic. The loan acts as a way of recovering post the pandemic so that these vendors don’t lose their livelihood.

It has been found out from recorded data that vendors from UP form 28% of the total beneficiaries with 11.63 lakh applicants out of which 6.93 lakh received the loan. The scheme has been recently enhanced as now upon repayment, the beneficiaries can take loans upto INR 20,000 and then 50,000 after the second loan has been repaid.

Updated Date: 24-09-2021

Over 24 lakh loans have extended so far under the PM SVANidhi Scheme

The PM SVANidhi Scheme was initiated to provide loans upto INR 10,000 to the street vendors across India who were hit by the Covid-19 pandemic and had been in severe financial crisis to sustain their businesses. The loan has to be repaid in 12 months and has been launched under the Atmanirbhar Bharat initiative.

The number of applicants for loans under this scheme was around 20.65 lakhs in June which amounted to INR 2,045 Crore, but that number has jumped up to around 24.48 lakhs amounting upto INR 2,426.47 Crores. As per data, most applicants (around 44%) were fruit and vegetable vendors.

Updated Date: 06-09-2021

Parliamentary Panel suggests converting loan credit under PM SVANidhi scheme into cash grants

The Pradhan Mantri Street Vendors Atma Nirbhar Nidhi Scheme was launched in 2020 to help the street vendors survive despite losing their livelihood due to the Covid-19 pandemic. The scheme offers working capital loans amounting to upto INR 10,000 each to around 50 lakhs street vendors whose livelihood was affected by the pandemic. The loans under this scheme come with a 7% interest with a one-year tenure and repayment in monthly installments. The Parliament Standing Committee on Labour recently suggested that instead of having a loan credit amount, a direct cash grant for the vendors would be much more useful.

Updated Date: 20-08-2021

Labour Ministry  Supports Govt’s move To Lower rate of Unemployment In Parliament

Mr. Bhupender Yadav, the new Labour Minister, announced last Monday, i.e., July 19, that in the second quarter of 2020, the unemployment rate in India’s urban areas was about 20.8%. The reason for the rate being so high is being attributed to the two-month-long nationwide lockdown to break the chain of spreading of the COVID-19 pandemic. While replying to a question asked in the Lok Sabha, Mr. Yadav pointed out that the Periodic Labour Force Survey defines that in order to get a true picture of employment, today, is to assess the survey data for the full year, which comprises both urban and rural areas.

Updated Date: 26-07-2021

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