PM SVANidhi Yojana to Offer Cheap Loans to Street Vendors; Know Features, Benefits and How to Apply for It

Amid lockdown 5.0, the Union Cabinet, chaired by PM Narendra Modi, on 1st June 2020 has decided to launch a special micro-credit facility scheme called 'PM SVANidhi' that will provide affordable loans to the street vendors or thelewalas, according to a government statement. The scheme is likely to go a long way in enabling street vendors to start their work and earn livelihoods in the wake of Corona crisis.

The Special Micro-Credit Facility Scheme - PM SVANidhi or PM Street Vendor's AtmaNirbharNidh was launched by the Ministry of Housing & Urban Affairs to offer affordable loans to the street vendors.

The statement said that "Over 50 lakh people that includes vendors, hawkers, rehriwala, thelewalas, theliphadwala etc. in different areas/ contexts are expected to benefit from this scheme".

The goods supplied by vendors range from fruits, vegetables, tea, pakodas, breads, eggs, ready-to-eat street foods, textiles, apparel, footwear, books/ stationaries, artisan products, etc. The services include cobblers, pan shops, barber shops, laundry services etc.

Special features of 'PM SVANidhi' Scheme

• Mobile app and web portal based application process

• No guarantee will be required for this loan

• Initial loan up to Rs 10,000 for one year

• 7 percent interest subsidy on repayment of loan on or before time.

• Subsidy will be paid to eligible creditors on half yearly basis.

• Eligibility of more loans in case of timely & early repayment of first loan

• Monthly cashback facility on receipt or payment of digital transactions

Benefits of 'PM SVANidhi' Scheme

The vendors or thelewalas can avail of a working capital loan of up to Rs. 10,000 that is repayable in monthly instalments in the tenure of 1 year.

On timely or early repayment of the loan, an interest subsidy at 7% per annum would be credited to the bank accounts of beneficiaries via Direct Benefit Transfer (DBT) on a six-monthly basis.

No penalty would be charge on the early repayment of loan.

For the very first time MFIs or NBFCs or SHG Banks have been allowed in a yojana for the urban poor because of their ground-level presence & proximity to the urban poor including street vendors.