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PM SVANidhi

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November 05, 2020

Why in news?

The Pradhan Mantri Street Vendors Atmanirbhar Nidhi (PM SVANidhi) scheme was launched by the Ministry of Housing and Urban Affairs.

What is the scheme about?

  • Through the PM SVANidhi scheme, the central government would extend Rs 10,000 loan as working capital to street vendors.
  • This amount will help the street vendors to restart their businesses which have been hit by the Covid-19 pandemic.
  • The Small Industries Development Bank of India (SIDBI) is the scheme’s implementation agency.

What is the significance of the scheme?

  • This scheme will help in mainstreaming and legitimising genuine street vendors who have not got valid identity cards.
  • The scheme brings in financial mainstreaming of street vendors through loans and digital payments.

What is the next step?

  • The government wants to formalise its understanding of the street vending sector.
  • Making a first-of-its-kind database of the beneficiaries of this scheme will help in understanding the sector.
  • Based on that understanding, this sector would be brought under various schemes.

Why is such a study needed?

  • The scheme plans to extend the microcredit to over 50 lakh street vendors across India.
  • But, going beyond the mandate of this scheme, the government wants to use the data for comprehensive poverty alleviation.

How will the study be done?

  • Banks and municipal bodies are already collecting data about street vendors who are beneficiaries of the project.
  • Such data will be leveraged to create a profiling of the vendors.
  • Then, committees will be formed at the level of district administration to reach out to street vendors in their respective areas.
  • The government departments that are running welfare schemes should nominate their nodal officers in each city to complete the exercise.
  • Based on the profiling, a street vendor and anyone in his or her family will be gauged in terms of eligibility for various government schemes.
  • Based on eligibility, they will be given access to such welfare schemes.

Will this actually work towards poverty alleviation?

  • Becoming formal beneficiaries of various government schemes works as a big step towards entering the policy intervention network.
  • It also helps in financial mainstreaming in the long run.
  • The PMSVANidhi will be incentivising digital transactions by giving QR codes to the street vendors.
  • This QR code will be used to receive payments through the government’s BHIM UPI app.
  • They are given cash-back for digital transactions too.
  • The idea is that with a trail of digital transactions, the street vendors will create a formal transaction history in banks and will slowly build their creditworthiness for the future.

 

Source: The Indian Express

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