This is a Scheme launched by Central Government to facilitate street vendors to access affordable working capital loan for resuming their livelihoods activities, after easing of lockdown. The COVID-19 pandemic and consequent lockdowns have adversely impacted the livelihoods of street vendors. They usually work with a small capital base, which they might have consumed during the lockdown. Therefore, credit for working capital to street vendors will be helpful to resume their livelihoods.
(i) To facilitate working capital loan up to Rs. 10,000 at subsidized rate of interest;
(ii) To incentivize regular repayment of loan; and
(iii) To reward digital transactions.
(i) Initial working capital of up to Rs.10,000/-
(ii) Interest subsidy on timely/ early repayment @ 7%
(iii) Monthly cash-back incentive on digital transactions
(iv) Higher loan eligibility on timely repayment of the first loan.
Street vendors/ hawkers vending in urban areas, as on or before March 24, 2020, including the vendors of surrounding peri-urban and rural areas. Street Vendor/hawker means Any person engaged in vending of articles, goods, wares, food items or merchandise of daily use or offering services to the public in a street, footpath, pavement etc., from a temporary built up structure or by moving from place to place. The goods supplied by them include vegetables, fruits, ready-to-eat street food, tea, pakodas, breads, eggs, textile, apparel, artisan products, books/ stationary etc. and the services include barber shops, cobblers, pan shops, laundry services etc.
Scheduled Commercial Banks, Regional Rural Banks, Small Finance Banks,
Cooperative
Banks, Non-Banking Financial Companies, Micro-Finance Institutions and SHG
Banks.
The Scheme shall be implemented up to March 2022
The Initial working capital loan is upto Rs.10,000/- for a tenure of one year.
You can approach a Banking Correspondent (BC)/ Agent of Micro Finance Institution (MFI)
in your area (ULBs will have the list of these persons).
They will help you in filling up the
application and upload the documents in a Mobile App/ Portal.
You can access this information on the website of Ministry of Housing and Urban Affairs.
Persons with name is in the list of surveyed vendors, but do not have either Identity Card or Certificate of Vending can also avail the loan facility. A Provisional Certificate of Vending would be issued to vendors through an IT based Platform. The BC/ Agent will help you in filling up the application and upload the documents in a mobile App/ Portal.
The Scheme is available to vendors of surrounding development/ peri-urban/ rural areas vending in the geographical limits of the cities/ towns and those left out of the survey. If you belong to this category you have to produce one of the following documents to obtain the Letter of Recommendation from ULB/TVC:
(i) Documents of past loan taken from a bank/ NBFC/ MFI for the purpose of vending;
or
(ii) If the person is a member of street vendors' association like NASVI, NHF, SEWA etc., his membership details;
or
(iii) Any other documents to prove that the person is a vendor; The vendor can also request ULB through a simple application on white paper to conduct local enquiry to ascertain the genuineness of his claim. After receipt of LoR, you may approach BC/ Agent to apply for the loan.
KYC documents required in addition to CoV/ ID / LoR
Anyone of the following documents is valid for KYC :
(i) Aadhaar Card,
(ii) Voter's Identity Card,
(iii) Driving Licence,
(iv) MNREGA Card,
(v) PAN Card.
The rate of interest subsidy 7%. The interest subsidy amount will be credited directly in the account of vendor on quarterly basis. In case of early payment, the admissible amount of subsidy will be credited in one go. For a loan of Rs.10,000, if you pay all the 12 EMIs in time, you will get approximately Rs.400 as interest subsidy amount.
Security for Loan
No collateral security is required.
incentive for digital transactions
The on-boarded vendors would be provided with a monthly cashback in the range of
Rs.50 -Rs.100 as per the following criteria:
(i) On executing 50 eligible transactions: Rs.50;
(ii) On executing the next 50 eligible transactions: Additional Rs.25; and
(iii) On executing the next 100 eligible transactions:
Additional Rs.25.
Each transaction > Rs.25 will be counted.
For those who are not familiar with digital transactions.
An agent from MFI/ payment aggregator will approach you to onboard and help in conducting sample transactions. The vendor will also be provided with a debit card and a QR code.
Incentive for timely/ early repayment of loan
On
timely/ early repayment of loan of initial working capital, a vendor becomes
eligible to
avail a higher tranche of loan in next cycle. There is no penalty for
pre-closure of the loan.
Enhance my chances of availing this loan
The Vendor may become a part of Common Interest Group (CIG) formed by ULB or Joint Liability Group (JLG) formed by a lending institution.
Where to approach to avail the facility
The Vendor may meet a member of SHG or ALF or CLF or call toll free number.
Identity Card for use
The vendor will be issued Provisional Identity Card on approval of loan and permanent CoV/ID will be issued within 30 days.
Time period to get
the loan approved
Complete process will be automated through a Mobile App and Web Portal. You will
be able to check real time status of your application. Whole process, if paper/
information is
complete, may take less than 30 days.
In case of any grievance, the vendor may contact the following officer in the
Ministry:
Director (NULM), Room no.334-C, Ministry of Housing & Urban Affairs,
Nirman Bhawan,Maulana Azad Road, New Delhi - 110011
e-Mail: neeraj.kumar3@gov.in
Tel: 011-23062850.