The PM SVANidhi scheme was launched by the Ministry of Housing and Urban Affairs (MoHUA) on June 1, 2020. Its primary goal is to provide handholding support to street vendors across India. By offering affordable working capital loans, the scheme aims to empower street vendors and promote self-reliance.
Street vendors can access a collateral-free loan of ₹10,000 initially. Additionally, they can apply for subsequent loans of ₹20,000 and ₹50,000, with a 7% interest subsidy. Initially, the scheme was until March 2022. However, it has been extended with existing components till December 2024. Vendors who have fully repaid their 1st loan are eligible for a 2nd loan of up to ₹20,000.
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Overview of PM Svanidhi Yojana
The PM SVANidhi scheme, initiated by Prime Minister Narendra Modi, provides loans ranging from ₹10,000 to ₹50,000 to street vendors without requiring collateral. It specifically targets small business owners, allowing them to access loans without guarantees to further their businesses. The scheme benefits various street vendors, including vegetable and fruit sellers, as well as those operating small fast food shops. Additionally, small shop owners and grocery store proprietors can also avail themselves of this scheme.
This loan is disbursed in three stages to meet working capital needs:
- Initially, vendors receive a ₹10,000 loan.
- After repaying the first loan within 12 months, they become eligible for a ₹20,000 loan.
- Finally, vendors can access a ₹50,000 loan.
Notably, the government provides these loans without demanding any guarantees. This enables entrepreneurs to kickstart new businesses. Furthermore, beneficiaries receive subsidies as part of this scheme.
Overview Of PM Svanidhi
| Aspect | Details |
|---|---|
| Scheme Name | PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) |
| Objective | Provide micro-credit facility for street vendors |
| Eligibility | Beneficiaries from states/UTs notified under the Street Vendors (Protection of Livelihood and Regulation of Street Vending) Act, 2014 |
| Loan Amount | Collateral-free loans up to ₹50,000 |
| Loan Tranches | – ₹10,000 (1st tranche) – ₹20,000 (2nd tranche) – ₹50,000 (3rd tranche, if 1st and 2nd tranche loans are repaid) |
| Repayment Tenure | One year, in monthly installments |
| Interest Subsidy | 7% if repaid on time |
| Implementing Partner | Small Industries Development Bank of India (SIDBI) |
| Scheme Period | Initially till March 2022, extended beyond December 2024 (PM SVANidhi 2.0) |
| Contact | Toll-free number: 1800 11 1979 (Monday to Saturday, 9:30 AM to 6:00 PM, except National Holidays) |
Benefits and Features of The Scheme
The Pradhan Mantri Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) scheme is a transformative initiative by the Indian government aim at providing financial support to street vendors who have been suffering from the COVID-19 pandemic. Here are the key aspects of the PM SVANidhi Scheme:
- Working Capital Loans: Street vendors can avail working capital loans of up to ₹10,000, repayable over a one-year period in manageable monthly installments.
- Collateral-Free Loans: The loans are provided without the need for collateral, making them accessible to a wide range of street vendors.
- Interest Subsidy: The scheme offers an interest subsidy of 7% to encourage timely loan repayment.
- Cashback on Digital Transactions: Street vendors who choose to make their loan repayments through digital channels are rewarded with cashback incentives.
- Enhanced Next Tranche of Loans: Vendors who consistently repay their loans can become eligible for higher loan amounts in subsequent tranches.
- Handholding Support: The program provides support and guidance to street vendors throughout the loan process.
- Access to Formal Financial System: By facilitating loans and promoting digital transactions, the scheme aims to integrate street vendors into the formal financial system.
The PM SVANidhi Scheme has been extend till December 2024, with a renew focus on expanding the loan funding and promoting socio-economic development for street vendors and their families. Approximately 42 lakh street vendors are to benefit from this initiative by the end of 2024.