Introduction
In a move to deepen financial inclusion and support India’s vast informal sector, the central government has revamped the PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi) scheme. The new version of the scheme introduces higher loan eligibility, along with a major upgrade: credit cards with a ₹30,000 spending limit for eligible vendors.
This is a game-changing step for street vendors who often operate outside the formal banking system, enabling them to access low-cost working capital and build a financial footprint.
What Is the PM SVANidhi Scheme?
Launched in June 2020 during the pandemic, the PM SVANidhi scheme was designed to provide collateral-free, micro-credit loans to street vendors across urban and semi-urban India. It helped lakhs of vendors revive their businesses by offering:
- Initial working capital loan of ₹10,000
- Subsidized interest rates
- Incentives for timely repayment and digital transactions
The scheme is implemented by the Ministry of Housing and Urban Affairs (MoHUA) in collaboration with public and private sector banks, NBFCs, and microfinance institutions.
What’s New in the Revamped Scheme?
The new version of PM SVANidhi introduces two major enhancements:
1. 💳 Credit Cards with ₹30,000 Limit
- Vendors who have successfully repaid their earlier tranches under the scheme (₹10,000 and ₹20,000 loans) will now be eligible for credit cards.
- These cards will offer a spending limit of ₹30,000, usable for day-to-day business and personal needs.
- The goal is to instill responsible credit behavior while giving vendors the flexibility of revolving credit.
2. 💸 Higher Tiered Loans
- The scheme now includes multi-tiered loan support:
- 1st loan: ₹10,000
- 2nd loan: ₹20,000 (after successful repayment)
- 3rd loan: ₹50,000 (for well-performing vendors)
- This encourages vendors to scale their businesses, not just sustain them.
Why This Matters
✅ Bringing Vendors into the Formal Financial Fold
Credit cards with spending limits and repayment histories will help vendors:
- Build credit scores
- Access mainstream financial services
- Move from cash dependency to digital transactions
✅ Promoting Women’s Economic Empowerment
Many beneficiaries of PM SVANidhi are women vendors, who often face challenges in getting access to credit. The revamped scheme helps:
- Increase their financial independence
- Support home-based and market-based businesses
✅ Boost to Urban Micro-Economies
Street vendors contribute significantly to local economies. Increased financial support:
- Improves liquidity in urban markets
- Reduces reliance on informal lenders
- Enhances supply chain resilience
Eligibility Criteria for Credit Card Facility
To be eligible for the ₹30,000 credit card limit:
- The vendor must have successfully repaid the first and second tranches (₹10,000 and ₹20,000).
- The business must be active and verifiable through Aadhaar-linked identification.
- Digital repayment behavior and use of digital wallets/UPI will be considered favorably.
How to Apply
Street vendors can apply via:
- Urban Local Bodies (ULBs)
- Partner banks and MFIs
- Online portals like the PM SVANidhi portal
Local authorities and NGOs are also involved in handholding support, especially for first-time applicants.
Challenges and Road Ahead
While the revamped scheme is a step in the right direction, some challenges persist:
- Financial literacy gaps among street vendors
- Last-mile connectivity in reaching all eligible vendors
- Risk of over-indebtedness if financial behavior is not monitored
To counter these, the government plans to:
- Expand financial literacy programs
- Integrate real-time data monitoring
- Use digital analytics to predict defaults and tailor interventions
Conclusion
The revamped PM SVANidhi scheme is more than just a financial tool—it’s a social upliftment strategy aimed at empowering some of India’s most hardworking yet vulnerable entrepreneurs. By offering tiered loan support and credit card access, the government is redefining financial inclusion at the grassroots level.
As India moves toward a more inclusive economy, enabling street vendors with formal credit and digital tools is not just progressive policy—it’s smart economics.
