MoU for providing Special Micro-Credit Facility for Street Vendors signed

The Union Ministry of Housing and Urban Affairs has signed a memorandum of understanding (MoU) with Lucknow based financial institution SIDBI- Small Industries Development Bank of India on 19^th June 2020. The MoU will provide a boost in building Atmanirbhar Bharat by providing credit or loans to the street vendors across the country for resuming their livelihood activities.

About the MoU

• The MoU authorizes SIDBI as the implementing agency for the Pradhan Mantri AtmaNirbhar Nidhi (PM SVANidhi) scheme. 
• The scheme will be under the guidelines set up by the Ministry of Housing and Urban Affairs.

PMSVANidhi

• The scheme was launched on 1^st June 2020 by the Ministry of Housing and Urban Affairs with a target to provide financial support to more than 50 lakh street vendors across the country. 
• A street vendor can avail a loan of up to Rs 10,000 under the scheme which has to be repaid within a period of 1 year, there will be no penalty for early repayment of the loan amount. 
• For repayment of loan or credit, monthly installments can be availed by the vendor.
• The interest on the loan amount will be 7%, which however will be credited back on a quarterly basis to the bank accounts on the beneficiary as interest subsidy –if the beneficiary is able to make timely repayment of the loan amount.
• The scheme will be provided in a phased manner, with a total of 108 cities being selected for the first phase which is expected to commence in the month of July 2020.
• To ensure collateral-free credit under the scheme, the credit guarantee for the lending institutions will be managed by SIDBI through the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).