PM SVANidhi Scheme

PM SVANidhi Scheme

About the Scheme

• Central Sector Initiative: Fully funded by the Ministry of Housing and Urban Affairs.
• Primary Objectives:
  1. Facilitate working capital loans for street vendors.
  2. Incentivize regular repayment behavior.
  3. Reward digital transactions.
• Loan Provision:
  • Offers loans in three stages:
    • 1st Loan: Up to ₹10,000.
    • 2nd Loan: Up to ₹20,000.
    • 3rd Loan: Up to ₹50,000.
  • Loans are collateral-free.

• Involved Institutions:
  • Microfinance Institutions (MFIs).
  • Non-Banking Financial Companies (NBFCs).
  • Self-Help Groups (SHGs).
• These agencies are chosen due to their strong presence among urban poor and proximity to street vendors.

1. State/UT Compliance:
   • Applicable only in States/UTs that have implemented the Street Vendors (Protection of Livelihood and Regulation of Street Vending) Act, 2014.
   • Vendors from Meghalaya are included under its state-specific Act.
2. Street Vendor Coverage:
   • Open to all street vendors operating in urban areas.
   • Initially, it covered vendors active as of March 24, 2020, but has since expanded.

1. Interest Subsidy:
   • Vendors receive a 7% annual interest subsidy via Direct Benefit Transfer (DBT) every six months.
2. Credit Limit Increases:
   • Timely repayment improves credit scores, making vendors eligible for higher loan amounts in subsequent terms.
3. No Prepayment Penalty:
   • Vendors can repay loans ahead of schedule without facing any penalty.

1. Encouraging Digital Transactions:
   • Cashback incentives for street vendors conducting monthly digital transactions.
2. Transparency in Operations:
   • A digital platform with a web portal and mobile app ensures end-to-end solution delivery.
   • Integration with key systems such as:
     • Udyami Mitra Portal (for credit management).
     • PAiSA Portal (to process interest subsidies automatically).

• Helps integrate street vendors into the formal financial system, fostering long-term economic inclusion.

• Training Programs:
  • Collaboration between MoHUA and State Governments to launch capacity-building initiatives and financial literacy campaigns.
• Information Dissemination:
  • Nationwide Information, Education, and Communication (IEC) activities to raise awareness.

• Implementation Leadership:
  • ULBs ensure efficient outreach and implementation of the scheme, targeting eligible beneficiaries effectively.

Key Takeaways
PM-SVANidhi is a transformative initiative aimed at empowering street vendors by providing access to affordable credit and promoting financial inclusion. By incentivizing timely repayment, encouraging digital transactions, and integrating beneficiaries into the formal financial system, the scheme enhances economic resilience among urban poor. Its focus on capacity building, transparency, and leveraging technology ensures sustainable implementation. With active participation from Urban Local Bodies and financial institutions, PM-SVANidhi represents a significant step toward inclusive urban development and upliftment of livelihoods.

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