Prime Minister Street Vendor’s Atma Nirbhar Nidhi Scheme or PM SVANidhi Scheme is a funding scheme that was created by The Ministry of Housing and Urban Affairs(MoHUA) in 2020. It is a micro credit facility for vendors through which they can get unsecured business loans that are collateral-free of up to Rs. 20,000 at very low interest rates and flexible repayment choices.
The lockdowns during the coronavirus pandemic that immensely impacted the livelihoods of everyone, mainly the street vendors. They usually work with a very limited capital base. Their capital base and savings would have diminished during lockdown.
These vendors play an important part in the informal economy of the urban area. They also ensure the availability of necessary goods and services at a reasonable price to the urban city dwellers.
Salient Features of PM SVANidhi
Some features of the PM SVANidhi scheme are:
- It is a scheme that is mainly focused on street vendors who were affected by Covid-19.
- Loan amount of up to Rs. 20,000.
- The repayment tenure goes up to 1 year.
- The bank does not require security/collateral.
- Interest rate subsidy of 7% if the unsecured business loan is repaid on time.
Objectives of PM SVANidhi
The Prime Minister Street Vendor’s AtmaNirbhar Nidhi scheme was introduced by the Indian government in the year 2020 to give working capital credit to the vendors. With this plan, the vendors can avail loans that are collateral-free and have low-interest rates for a year.
The main objectives of this scheme are:
- To encourage regular repayment of the unsecured business loan.
- To provide and facilitate loans for working capital of up to Rs. 10,000 at a subsidised interest rate,
- To reward transactions done digitally by vendors.
Eligibility Criteria for PM SVANidhi Scheme
This scheme is available to all the street vendors who have been working in urban areas before the 24th of March, 2020. The eligible applicants under this plan are identified according to the criteria that follows:
- Street vendors who are survey identified but do not have an Identity Card or Certificate of Vending. In case of such a scenario, the Provisional Certificate of Vending will be given to the street vendors.
- Street vendors that have a Vending Certificate or an ID card issued by the Urban Local Bodies (ULBs).
- Street vendors who were left out of the identification survey or those who started vending only after the survey completion but have a Letter of Recommendation(LoR) by the Town Vending Committee(TVC) or ULB.
- Street vendors in the surrounding peri-urban or rural or development areas who vend in the geographical coverage of the ULB and have a LoR by the TVC or ULB.
Benefits of PM SVANidhi Scheme
The benefits that the street vendors enjoy under the PM SVANidhi Yojana Scheme are as follows:
Interest Subsidy
The vendors who get a working capital loan under the PM SVANidhi scheme can get a subsidy on interest subsidy of 7%. This subsidy amount is credited quarterly to the borrower’s account. The interest subsidy is available first and the subsequent increased loan up to that date.
Loans For Working Capital
The vendors can get a Working Capital loan with a cap of Rs. 10,000 and a tenure of a year which can be repaid in easy EMIS. There is no need for collateral for this loan. On timely or early loan repayment, the vendors will have the eligibility for the next round of working capital loan with an enhanced limit. There is no penalty charge for prepayment for the repayment of the working capital loan before the due date.
Interest Rate
In the case of Small Finance Banks (SFBs), Scheduled Commercial Banks, Cooperative Banks, SHG (self-help groups) banks, and Regional Rural Banks (RRBs), the interest rate will be the same as their prevailing interest rates.
In the case of NBFC-MFIs, NBFCs etc,the rate of interest will be as per the Reserve Bank of India guidelines for the respective category of lender.
In respect to Micro Finance Institutions and other categories of lenders that do not come under the Reserve Bank of India guidelines, the rate of interest will be applicable as per the extent of the guidelines of RBI for NBFC-MFIs.
Digital Transactions Promotion
This scheme provides incentives for adopting digital transactions by vendors with the facility of cash-back. The network of digital payment aggregators and lending institutions such as NPCI, Paytm, AmazonPay, GooglePay, PhonePe, BharatPay, etc., helps in the easy onboarding of the vendors. The vendors who are onboarded will get incentives in the form of monthly cashbacks in the range of Rs. 50 – Rs. 100.
List of Financial Institutions Offering PM SVANidhi Loan
| Public Sector Banks | Small Finance and RRBs | Canara Bank |
| Private Sector Banks | Bank of India | ICICI Bank |
| Utkarsh Small Finance Bank | IDBI Bank | State Bank of India (SBI) |
| Suryoday Small Finance Bank | South Indian Bank | Bank of Maharashtra |
| Jammu & Kashmir Bank | Kerala Grameen Bank | Central Bank of India |
| Axis Bank |
Documents Required for the PM Street Vendor Loan
The following documents are required for the PM SVANidhi scheme application:
- Certificate of Vending Copy (CoV)
- Vendor’s identification card
- Letter of Recommendation(LoR)
- Provisional CoV (if necessary)
- Other KYC documents – Voter’s ID Card, Aadhaar Card, PAN Card, Driving License, MNREGA Card, etc.
PM SVANidhi Interest Subsidy
If a street vendor gets a unsecured business loan from the PM SVANidhi Yojana scheme, he/she is eligible for a subsidy of interest. The subsidy that is currently being offered is 7%. The amount that is generated because of the subsidy will be credited to his/her account on a quarterly basis.
The Ministry of Housing & Urban Affairs’ initiative of PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) to empower every street vendor by not only extending low-interest loans, but also for their overall economic upliftment and development was a great success. The policy has approximately helped 50 Lakh street vendors by helping them resume their businesses including surrounding rural/peri-urban areas.