PM SVANidhi: Advancing Financial Inclusion for Street Vendors
The PM Street Vendor's AtmaNirbhar Nidhi (PM SVANidhi) scheme has significantly advanced financial inclusion for urban micro-entrepreneurs by providing collateral-free working capital loans.
What happened
The PM Street Vendor's AtmaNirbhar Nidhi (PM SVANidhi) scheme has significantly advanced financial inclusion for urban micro-entrepreneurs by providing collateral-free working capital loans. Launched by the Ministry of Housing and Urban Affairs (MoHUA), the scheme facilitates initial loans of ₹10,000, with enhanced tranches of ₹20,000 and ₹50,000 upon timely repayment. It incentivizes digital transactions through cashback and builds credit profiles for street vendors, integrating them into the formal financial system. The initiative also encompasses the 'SVANidhi se Samriddhi' program, linking vendors' families to broader socio-economic welfare schemes, thereby ensuring holistic development and economic resilience.
PM SVANidhi is a Central Sector Scheme fully funded by the Ministry of Housing and Urban Affairs (MoHUA), designed to empower street vendors affected by the pandemic.
●It stands out by offering collateral-free working capital loans in escalating tranches (₹10,000, ₹20,000, and ₹50,000) to encourage credit discipline.
●A crucial feature is the 7% per annum interest subsidy credited quarterly through Direct Benefit Transfer (DBT) for timely repayments.
●Furthermore, it promotes the digital economy by offering cashbacks up to ₹1,200 annually for digital transactions.
●The Small Industries Development Bank of India (SIDBI) serves as the technical partner for implementation, managing the credit guarantee trust fund (CGTMSE).
The scheme uniquely combines micro-credit access with digital literacy and formal credit history generation for the unorganized sector.
Factual Pointers
Practice · 1 question
Consider the following statements regarding the PM SVANidhi scheme:
1. It is a Centrally Sponsored Scheme implemented by the Ministry of Finance.
2. It provides an interest subsidy of 7% per annum on timely repayment of loans.
3. SIDBI is the technical partner for the implementation of this scheme.
How many of the above statements are correct?
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