As one of the largest micro-credit urban programmes worldwide, PM SVANidhi has been an effective vector of ensuring societal harmonisation among unformalised segments of urban micro-entrepreneurs from fringe strata and dismantling select community blockades, a report said.
The government launched Prime Minister Street Vendor's Atma Nirbhar Nidhi (PM SVANidhi) Scheme on June 1, 2020, to facilitate collateral-free working capital loans of up to Rs 50,000 to street vendors to restart their businesses, which were adversely impacted by the COVID-19 pandemic.
As per the report by SBI Research, 43 per cent of women beneficiaries in the scheme indicates empowerment of entrepreneurial capabilities of urban female.
The ratio of people repaying the first loan of Rs 10,000 and taking the second loan of Rs 20,000 is 68 per cent, while the ratio of people repaying the second loan of Rs 20,000 and taking the third loan of Rs 50,000 is 75 per cent, it said.
According to the report, the average debit card spending of PM SVANidhi account holders increased by 50 per cent post-disbursement of loan instalments.
There is a 61 per cent probability of a loan recipient who was earlier not spending starts to spend actively post disbursement of the PM SVANidhi loan, it noted.
On average, 63 per cent of those below the 25 and above 60 age groups spend more post disbursement of loan, and the share of active spenders in those having received the second and third loan instalments is as much as 30 per cent, it said.
PM SVANidhi is impacting the behavioural habits in terms of spending and digital transactions post receipt of loan instalments for a nearly identical class of marginalised population like PMJDY depositors, the report added.
Spending avenues of PMJDY Accounts are majorly towards basics, while PMJDY with SVANidhi account holders are found to be spending more on consumeristic avenues.
A back-of-the-envelope calculation suggests that the number of beneficiaries who have been either new to credit/deposit in the last nine years is around 30 per cent on average (of the new credit accounts added during this decade), contributing around 8 per cent of incremental credit growth, it said.
In deposits, around 42 per cent of the new account opened is only due to PMJDY and Sukanya Samriddhi Yojana (SSY), as per the report.
"If we look to the incremental GDP growth during FY14-23, then the formalisation through new government schemes (Deposits + Credit) stands at 6 per cent. We believe there is a revolution at the bottom of the pyramid and this is likely to sustain the credit growth," it said.
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