Highlights: Loans sanctioned under PM SVANIDHI scheme crosses 1 lakh

The micro-credit scheme of the government, PM Street Vendor’s Atmanirbhar Nidhi (PM SVANIDHI) to support the street vendors to meet their working capital requirements to tide over financial woes during the pandemic, has become quite popular in the country.


Within 41 days of the implementation of the scheme, the number of loan sanctions and the number of applications received under the PM SVANIDHI Scheme crossed the mark of 1 lakh and 5 lakhs respectively, from July 02, 2020. It has generated interest in the street vendors since they were looking for some source of finance during the difficult times of the pandemic-induced lockdown. Their business was disrupted due to the situation and they had no other option to start and continue the business. This scheme has provided them with working capital to start their business again.


This scheme was launched by the Ministry of Housing and Urban Affairs under the ambit of ‘Atmanirbhar Bharat Abhiyan’ and it aims at facilitating collateral-free working capital loans up to Rs 10000 of 1-year tenure, to about 50 lakh vendors in the urban areas, including those from the surrounding peri-urban or rural areas, to start their business post the COVID 19 lockdown. If the loans are being paid regularly, there will be interest subsidy of 7% per annum and also cash-back up to Rs 1200 per annum on undertaking prescribed digital transactions and eligibility for enhanced next tranche of loan have also been provided.

What is Micro Credit Scheme?

Micro Credit is defined as the services such as credit, thrift, etc. is provided to the poor in rural, semi-urban and urban areas for enabling them to raise their income levels and improve their standard of living. Micro Credit originated with the Grameen Bank in Bangladesh, launched and conceptualized by Muhammad Yunus, for which he was bestowed with the Nobel Prize as well. There are various such schemes in force now such as the PM Mudra Yojana, etc. NABARD, SIDBI are the main organizations involved in providing microcredit to the beneficiaries through direct financing and re-financing.


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