Impact of PM SVANidhi scheme on street vendors: SBI report
An SBI research report has praised the Modi government’s micro-credit PM SVANidhi scheme for street vendors for ensuring inclusive entrepreneurship. It said nearly 75 percent of its beneficiaries come from the non-general category with the OBCs accounting for 44 percent.
PM SVANidhi scheme is a Central Sector Scheme to facilitate street vendors to access affordable working capital loan for resuming their livelihoods activities, after easing of lockdown.
The COVID-19 pandemic and consequent lockdowns have adversely impacted the livelihoods of street vendors. They usually work with a small capital base, which they might have consumed during the lockdown. Therefore, credit for working capital to street vendors will be helpful to resume their livelihoods.
Key Findings of Report on PM SVANidhi scheme
Impact on women: 43% of the total beneficiaries are women which indicates the empowerment of
entrepreneurial capabilities of urban females.
Breaking down community barriers: Almost 75% of beneficiaries come from the non- general category (OBCs- 44% , SCs/STs-22%) whereas 65% are in the age group of 26-45.
Popularity of Scheme: The persistency ratio (2nd loan/1st loan repaid) is increasing indicating the need and popularity of Scheme.
Digital transactions: It has increased the acceptability of digital transactions.
Consumer Behaviour: The average debit card spending of PM Svanidhi account holders increased by 50% after loan instalments, marking a significant change in their financial behaviour.
Prime Minister Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) scheme
is a Central Sector Scheme fully funded by the Ministry of Housing and Urban Affairs.
Objective: Integrating street vendors into the formal economic system and facilitating access to formal
channels of credit
Key features
♦ It is a micro-credit scheme for urban street vendors to provide collateral-free working capital loans up to ₹50,000.
♦ Regular repayments are incentivized with a 7% interest subsidy
♦ Digital transactions are rewarded with cashback up to ₹1,200 per year.