PM SVANidhi Scheme for Street Vendors, Features & Objectives

Collateral-Free Working Capital Loans: 

• Vendors can avail working capital term loans without any collateral, security, or margin requirement. 

• There are no processing fees charged by banks, making the loan completely affordable and accessible to even the smallest hawkers. The loan tenure for each tranche is relatively short (1 year for first loan, 18 months for second, up to 36 months for third) with monthly EMI repayment.

Enhanced Loan Tranches: The scheme follows a graded credit limit model:

• First loan up to ₹10,000 (now increased to ₹15,000 under PM SVANidhi Scheme 2.0), for an initial tenure of 12 months.

• Upon repayment, Second loan up to ₹20,000 (now ₹25,000) becomes available, with 18 months tenure.

• After repaying second, Third loan up to ₹50,000 can be availed (36 months tenure).

Each successive loan is larger, encouraging vendors to repay on time to graduate to higher credit. 

• No prepayment penalty is charged, and early repayment is rewarded by quicker eligibility for the next loan cycle. 

• This feature helps vendors scale up their operations in phases, from petty shop or cart to a more stable micro-enterprise.

UPI-Linked Credit Card: A unique new feature is the introduction of UPI-linked RuPay Credit Cards for street vendors. 

• Vendors who have successfully repaid the second tranche loan will be provided a RuPay credit card (working as a small credit line) linked with UPI. 

• This gives immediate access to credit for day-to-day business needs or personal emergencies without having to apply for a new loan.

Identification & Vendor Certificate: Proper identification is ensured to legitimize street vendors:

• Vendors already having a Certificate of Vending/ID card issued by the ULB are directly eligible.

• Those identified in surveys but without an ID are given a Provisional Certificate of Vending through the IT portal, and ULBs will issue permanent IDs within a month.

• New vendors (missed in surveys or started recently) can be recommended by ULB/Town Vending Committee via a Letter of Recommendation (LoR) to avail the loan.

These measures provide formal recognition to street vendors (often an unorganized sector), enabling them to access not just SVANidhi loans but other government benefits and services. A PM SVANidhi Identity Card also empowers vendors against undue harassment and gives them an official identity as micro-entrepreneurs.

Extended Scheme Period: The lending under the initial scheme was available until December 2024. Now, the scheme’s lending timeline is extended up to March 31, 2030 under the approved restructuring. This long extension (with government support for interest subsidy until 2030) provides a wider window for vendors to avail multiple cycles of loans. It reflects a shift from a one-time pandemic relief to a long-term program for vendor development.