Brief Details of the Product
Urban street vendors will be eligible to avail a Working Capital (WC) loan of up to
Rs.10,000 with tenure of 1 year and repaid in monthly instalments. For this loan, no
collateral will be taken by the lending institutions. On time or early repayment,
the vendors will be eligible for the next cycle of working capital loan with an
enhanced limit. No prepayment penalty will be charged from the vendors for repayment
before the scheduled date.
Rate of Interest
In case of Scheduled Commercial Banks, Regional Rural Banks (RRBs), Small Finance Banks (SFBs), Cooperative Banks & SHG Banks, the rates will be as per their prevailing rates of interest. In case of NBFC, NBFC-MFIs etc., interest rates will be as per RBI guidelines for respective lender category. In respect of MFIs (non NBFC) & other lender categories not covered under the RBI guidelines, interest rates under the scheme would be applicable as per the extent RBI guidelines for NBFC-MFIs.
The vendors, availing loan under the scheme, are eligible to get an interest subsidy @ 7%. The interest subsidy amount will be credited into the borrower’s account quarterly. Lenders will submit quarterly claims for interest subsidy for quarters ending as on June 30, September 30, December 31 and March 31 during each financial year. Subsidy will only be considered in respect of accounts of borrowers, which are Standard (non-NPA as per extant RBI guidelines) on respective claim dates and only for those months during which the account has remained Standard in the concerned quarter. The interest subsidy is available up to March 31, 2022. The subsidy will be available on first and subsequent enhanced loans up to that date.