PM SVANidhi: Working Capital Loans for Street Vendors
PM SVANidhi (Street Vendor's AtmaNirbhar Nidhi) is a government scheme launched to give street vendors formal access to small working-capital loans — the kind of short-term credit vendors have traditionally relied on informal, high-cost moneylenders for, simply because they had no credit history or collateral formal lenders would accept.
How the loan ladder works
The scheme is structured as an escalating series of loans rather than one fixed amount:
- First loan: up to ₹10,000, collateral-free, for working capital — stock purchase, daily operational needs.
- Second loan: up to ₹20,000, available after satisfactory repayment of the first.
- Third loan: up to ₹50,000, available after satisfactory repayment of the second.
Each step up depends on a clean repayment record on the previous loan — the scheme is deliberately designed to build a formal credit history for vendors who've never had one, one small, manageable loan at a time.
Why it's worth using formally, not just as a one-off
- Interest subvention: the scheme includes an interest subsidy for vendors who repay on time, effectively reducing the cost of the loan.
- Cashback for digital transactions: vendors who adopt digital payments (UPI QR codes) as part of their business can earn cashback incentives under the scheme, encouraging a shift toward traceable, formal transaction history.
- Credit history: because these loans are reported to credit bureaus, consistent repayment genuinely builds a formal credit score — something that can eventually help a vendor access larger, mainstream credit beyond the scheme itself.
Who's eligible
Vendors holding a Certificate of Vending or Identity Card issued by urban local bodies, or otherwise identified through the scheme's survey process, are eligible. If you don't yet have a vending certificate, that's typically the first step before applying.
For a street vendor, formal credit isn't just cheaper than informal borrowing — it's the first step toward a credit history that can open doors to larger loans down the line.