Businesses shut, only 11% street vendors benefited from PM Credit Scheme

 Their businesses hit by the pandemic, the government micro-credit scheme could have helped the poorest of India's street vendors. But only 11% of them could get a loan

Naresh Upadhyay, a street vendor from Anand Vihar in east Delhi, had applied for a Letter of Recommendation (LOR) from the East Delhi municipal corporation in December 2020. This letter would have helped him avail of a loan of Rs 10,000 under the PM SVANidhi scheme, a government micro-credit program to help street vendors formalize their businesses.

Upadhyay is among the millions of street vendors in India whose businesses have been hit by the pandemic. He had to close his kiosk when the lockdown was announced last year, and even after he reopened in January 2021, he has had few customers for the clothes and accessories he sells.

When the LOR arrived, Upadhyay found it riddled with errors. He had specified that he was a 'fixed' (permanent) vendor and had given the address of his stall, which has been running for nearly 20 years. But the LOR put him down as a 'mobile' vendor who ran his business from the 'New Delhi Municipal Corporation area'.

Worried that he would be accused of falsifying information, Upadhyay dropped his loan plan. Many other small vendors were also issued LORs with wrong information, he told IndiaSpend.

As Upadhyay's experience illustrates, the first phase of the two-year PM SVANidhi scheme, launched in June 2020, has been poorly implemented and has had limited impact on the most vulnerable section of street vendors it was meant to empower, according to a recent survey conducted by Indo Global Social Service Society (IGSSS), a civil society organization working with informal workers and settlements. These are street vendors who fall into the C and D categories of the scheme--those who do not have certificates of vending that would allow them to operate without the threat of intimidation or displacement by the police or municipal authorities.