pm-svanidhi-the-scheme-that-will-bring-street-vendors-out-of-poverty-summary

Context: The  Pradhan Mantri Street Vendors Atmanirbhar Nidhi (PM SVANidhi) scheme is already a hit, as 25 lakh street vendors have come forward seeking the loan.

More on the news: 

  • The next stage of the scheme is to make a first-of-its-kind database of the beneficiaries of this scheme. 
  • This will help in assessing who the beneficiaries are, and where they belong vis-à-vis the government’s social security net on education, housing, food, livelihood etc.

Need for such database:

  • Absence of any comprehensive structured data: On the socio-economic profile of street vendors and the street vending economy in India, even in government surveys like the NSSO and the Economic Survey.
  • For poverty alleviation: The scheme plans to extend the microcredit to over 50 lakh street vendors across India, and for going beyond the mandate of this scheme, the government wants to use the data for comprehensive poverty alleviation.

Vending in India:

  • In its 67-68th round report (2011-12), National Sample Survey Organisation (NSSO) defines street vendors as a category of “enterprises without fixed premises” among “Unincorporated Non-Agricultural Enterprises (excluding construction)”.
  • Vending is an important source of employment for a large number of urban poor as it requires low skills and small financial inputs and for the customers, it provides convenience and low priced goods and services. 
  • Exponential growth of the sector: As the scope for jobs in formal sectors (coupled with increased migration) is shrinking, informal sectors like street vending in big cities saw exponential growth over the past few decades.
    • The NSSO data estimated that around 200,000 women and 21,500 children were engaged in street vending. 
    • According to the think-tank Observer Research Foundation, around 1.18 million households were dependent on this sector as their primary source of income.

About PM SVANidhi: 

  • It is a Special Micro-Credit Facility for Street Vendors launched by the Ministry of Housing and Urban Affairs.
  • It will provide affordable Working Capital loans to street vendors to resume their livelihoods that have been adversely affected due to Covid-19 lockdown.
  • This scheme targets to benefit over 50 lakh Street Vendors. 
  • Under the Scheme, the vendors can avail a working capital loan of up to Rs. 10,000, which is repayable in monthly instalments in the tenure of one year. 
  • On timely/early repayment of the loan, an interest subsidy @ 7% per annum will be credited to the bank accounts of beneficiaries through Direct Benefit Transfer on quarterly basis. 
  • Implemented by: SIDBI will implement the PM SVANidhi Scheme under the guidance of MoHUA. 

Significance of the scheme:

  • Mainstreaming and legitimising genuine street vendors: Who have not got valid identity cards simply because local bodies have not updated their lists for years.
  • Poverty alleviation: Becoming formal beneficiaries of the scheme works as a big step towards entering the policy intervention network. 
  • Promoting digital transactions: PMSVANidhi is incentivising digital transactions by street vendors.

Source: The Statesman