Context
∙ A study commissioned by the Union Ministry of Housing and Urban Affairs evaluated the impact of the PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi).
PM-SVANidhi Scheme
∙ The PM SVANidhi is a micro-credit scheme which was launched by the government in 2020.
∙ The scheme is funded by the Ministry of Housing and Urban Affairs.
∙ The scheme aims to provide credit for working capital to street vendors who have been affected due to the Covid-19 crisis.
∙ The scheme facilitates collateral-free loans of INR 10,000/-, with subsequent loans of INR 20,000/- and INR 50,000/- with 7% interest subsidy for vendors, and rewards digital transactions.
∙ Eligible criteria: Street vendors in possession of Certificate of Vending/Identity Card issued by Urban Local Bodies (ULBs).
| Street vendors in India– Anyone who doesn’t have a permanent shop is considered a street vendor. – There are an estimated 50-60 lakh street vendors in India, with the largest concentrations in the cities of Delhi, Mumbai, Kolkata, and Ahmedabad.– Street-vending accounts for 14 percent of the total (non-agricultural) urban informal employment in the country. |
Findings of the study
∙ Nearly 60.65 lakh first-term loans, 16.95 lakh second-term loans and 2.43 lakh third-term loans have been disbursed so far under the scheme.
∙ The debt-to-income (DTI) ratio of the beneficiaries (9%) was lower than what was expected of small businesses, reflecting the “high creditworthiness” of the vendors.
∙ After the launch of PM SVANidhi, there had been no significant improvement in the street vendors getting formal credit from other sources — only 9% of the beneficiaries had loans from other financial institutions.
∙ The study found 13.9% of all the loans disbursed had been classified as non-performing assets (NPAs).
