The Centre on Monday launched a special micro-credit scheme to provide affordable loan of up to Rs 10,000 to street vendors, a move aimed at restarting their livelihoods affected due to coronavirus-triggered lockdown.
The Union Housing and Urban Affairs Ministry in a statement said the 'Pradhan Mantri Street Vendor's AtmaNirbhar Nidhi' is likely to benefit 50 lakh street vendors in the urban and rural areas of the country.
Those who were vending till March 24 this year can avail the benefits of the scheme, the duration of which is till March 2022, the statement said.
"The vendors can avail a working capital loan of up to Rs 10,000, which is repayable in monthly instalments in the tenure of one year.
"On timely or early repayment of the loan, an interest subsidy of seven per cent per annum will be credited to the bank accounts of the beneficiaries through direct benefit transfer on six monthly basis," the ministry said.
It stated that there will be no penalty on early repayment of loan.
The scheme, launched by the Ministry of Housing and Urban Affairs on Monday, is in pursuance to the announcement made by Union Finance Minister Nirmala Sitharaman on May 14, 2020, it said.
It stated that the scheme provides for escalation of the credit limit on timely or early repayment of loan to help the vendor achieve his ambition of going up on the economic ladder.
"This means if a street vendor repays the instalments on time or earlier, he or she can develop his or her credit score that makes him/her eligible for higher amount of term loan such as Rs 20,000," it said.
According to the HUA ministry, the urban local bodies will play a pivotal role in the implementation of the scheme.
They will leverage the network of all stakeholders like street vendor's associations, business correspondents (BCs), agents of banks, micro-finance Institutions (MFIs), self-help groups (SHGs) and their federations, digital payment aggregators like BHIM among others in administering the scheme successfully.
It stated that a digital platform with a web portal or a mobile app is being developed to administer the scheme with end-to-end solution.
"The IT platform will also help in integrating the vendors into the formal financial system. This platform will integrate the web portal or mobile app with UdyamiMitra portal of SIDBI for credit management and PAiSA portal of MoHUA to administer interest subsidy automatically," the ministry added.