PM Street Vendor's AtmaNirbhar Nidhi (PM SVANidhi), launched in June 2020, provides collateral-free working capital loans to urban street vendors displaced by COVID-19. Vendors begin with ₹10,000, scaling to ₹20,000 and then ₹50,000 on timely repayment. An interest subsidy of 7% per annum is credited directly to beneficiaries. The scheme is implemented by the Ministry of Housing and Urban Affairs through Urban Local Bodies, with Small Industries Development Bank of India as the nodal lending institution.

PM SVANidhi addresses a structural gap in urban financial inclusion: the roughly 50 lakh street vendors who operate outside the formal credit ecosystem. Before this scheme, vendors relied on moneylenders charging exploitative rates, creating a debt trap that prevented capital accumulation. The scheme's design is layered and behavioural. It starts small (₹10,000) to reduce lender risk, then rewards on-time repayment with credit graduation (₹20,000, then ₹50,000), nudging vendors toward formal financial discipline. The 7% per annum interest subsidy is paid as a cashback into the borrower's bank account, reinforcing digital transaction habits. Vendors who use digital payments earn additional cashback incentives, connecting the scheme to the broader India Stack and financial digitisation agenda.

From an RBI and NABARD lens, PM SVANidhi is a priority sector lending instrument — loans under the scheme qualify under the 'micro enterprises' sub-category within the Micro, Small and Medium Enterprises (MSME) priority sector target. This makes it directly testable in banking exams as both a welfare scheme and a credit delivery mechanism. For UPSC, the scheme illustrates urban livelihood governance, COVID-19 economic response, and the role of Urban Local Bodies in welfare delivery. The scheme also functions as a social registry — vendor identification through issuance of a Certificate of Vending integrates previously informal workers into a formal urban database, enabling future programme targeting.