Explained: How Scheme For Street Vendors Will Help Alleviate Poverty
With the new scheme launched by the government called PMSVAnidhi, several street vendors can benefit from the same. Under this scheme, the central government of India has announced to increase the working loan capital to Rs. 10,000. This will help the street vendors to build their businesses back after the pandemic. As of now, 25 Lakh street vendors have sought a business loan through PM SVAnidhi. This scheme is planned to extend to over 50 Lakh street vendors in India. While doing so, the government also wants to use the data collected from these vendors to alleviate poverty.
The PM SVAnidhi scheme will provide an interest subsidy that will be valid till the 31sr of March 2022. All street vendors are encouraged to use digital transactions so that they can get a cashback of Rs. 100 on a monthly basis. All of the street vendors who worked in urban areas on or before the 24th of March, 2020 can avail of the PM SVAnidhi scheme. The tenure provided to repay the business loan availed is 12 months. Let us have a deeper look into how PM SVAnidhi plans to help alleviate poverty with the help of digital payments and formalizing the sector.
How does PM SVAnidhi Plan to Alleviate Poverty?
To begin with, the government aims to gather enough data about the poorer socio-economic sectors to alleviate poverty. Currently, there is not enough data available on the socio-economic understanding of street vendors in a comprehensive structure that can be used. This data could not be found even through surveys such as the Economic Survey and NSSO (National Sample Survey Organisation). NSSO has defined the profile of street vendors under “Unincorporated Non-Agricultural Enterprises” as “Enterprises Without Fixed Premises”.
NSSO data estimated that nearly 21,500 children and 200,000 women are involved in street vending. This led to nearly 1.8 million households being dependent on street vending as their primary source of income. Professor Sharit Bhowmik, the leading scholar of the street vending economy of India, said that the hawkers made less than minimum wage most of the time. He also said that both poverty and the lack of employment options in the rural areas and small towns cause a large number of people to move to the cities to work.
As the number of jobs being available in the formal sector is decreasing, several people who move to the urban cities for work end up working in the informal sector. PM SVAnidhi aims to change this scenario by financing mainstreaming of street vendors with the help of digital payments and loans. This way, the street vending sector would be formalized and legitimizing the businesses run by street vendors.
In a Nutshell
With the PM SVAnidhi scheme in place, the central government aims to alleviate poverty by improving the legitimacy of their businesses and formalizing their sector. You can apply for PM SVAnidhi on the Mohua website. You can also apply for a business loan on Finserv MARKETS and experience benefits such as flexible tenure, need-based offerings, and many more.