The MoHUA(Ministry of Housing and Urban Affairs) on June 1, 2020, has launched a special micro-credit scheme called Pm Svanidhi scheme or Pradhan Mantri Street Vendor’s AtmaNirbhar Nidhi scheme to provide affordable loans of up to ₹10,000 to more than 50 lakh street vendors.
The Pm Svanidhi scheme is aimed at restarting the livelihood of street vendors by providing working capital of up to 10,000 which is repayable in monthly instalments in the tenure of 1 year. "Many small vendors in India work with high-interest rate usually 1% per day accounting to nearly 400% from the informal sector. Therefore the government has seen an urgent need to provide affordable loans for working capital through the formal banking sector to the street vendors to help them resume their business". Government official said.
Features of Pm Svanidhi scheme
- No collateral is required to avail the loan.
- The initial loan amount is up to ₹10,000.
- The interest rates are up to 7% for repayment of loans
- The money will be directly credited into your bank if you are eligible.
- Mobile app and web portal based application process(will be launched soon)
- The subsidy will be paid to eligible creditors o half-yearly basis.
- If the first loan is repeated on time, The second loan of ₹20,000 is also eligible.
- There is no Late-payment fee or early payment fee.
- If you pay your dues on time your credit score will also increase.
Documents required for Pm Svanidhi loan
- KYC documents are
- Yet to announce by Government of India.
Eligibility for Pm Svanidhi loan
- Businesses were operational on or before 24 March 2020.
- The scheme is applicable to vendors, hawkers and the goods supplied by them range from vegetables, fruits, ready-to-eat street foods, tea, Pakodas, Bread, eggs, textiles, apparel, footwear, artisan products, books/ stationaries etc.
- The services include barbershops, cobblers, pan shops, laundry services etc.
- For both Urban and Rural street vendors are eligible.
Further Eligibility will be released by the government.
Pm Svanidhi loan interest rates and Fees
- The interest rates are fixed at 7%
- There is no processing fee
- There is no early payment fee
- There is no late payment fee.
- But if you pay late, you cannot take a loan again through the platform.
How to get Pm Svanidhi loan?
The central government is yet to launch a digital platform with a web portal and mobile app is being developed to administer the scheme with an end-to-end solution. The IT platform will also help in integrating the vendors into the formal financial system of India. The government announced that Urban Local Bodies will be playing a pivotal role in the implementation of the scheme. The lending institutions under the Scheme include Scheduled Commercial Banks(SCB), Regional Rural Banks(RRB), Small Finance Banks(SFB), Cooperative Banks, NBFCs, Micro Finance institutions(MFI) and Self Help Group banks(SHGB).
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