How street vendors were crushed post Covid as India Inc.’s employees switched to work from home

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Updated: September 07, 2021 3:28 PM

Ease of Doing Business for MSME: The government had last June launched the PM SVANidhi scheme to offer working capital loan of up to Rs 10,000 for 12 months under the Atmanirbhar Bharat initiative to Covid-hit street vendors including hawkers selling fruits, vegetables, tea, footwear, local snacks, books, etc.

Despite Covid-related concerns ebbing with increased vaccination count and reduced number of Covid cases, a number of businesses are looking to continue with remote work till next year even as it also depends on the possibility of the third wave. (Representational image)

Ease of Doing Business for MSMEs: As India Inc shifted to remote work or WFH environment last year, street vendors selling goods around commercial locations including business and financial districts, office complexes, etc., struggled with their livelihood. Covid-related restrictions in movement and retailing goods particularly for street vendors had disrupted their daily earning capabilities and pushed them to switch to other menial tasks such as washerman, working at gas stations, delivering online food orders, etc, or they simply had to relocate their kiosk or cart to residential colonies.

For instance, it’s been more than a year since Satish Kumar switched from selling street food around commercial hubs of Udyog Vihar and Cyber City in Gurugram to vegetables in nearby residential areas. He also operated two kiosks selling cigarettes and tea in the area but daily sales had crashed to less than Rs 300. “My brother has been helping me run the two stalls. Along with food items, I was able to earn up to Rs 1,000 until Covid struck and offices got shut. I earned maximum during lunch hours but since last year, there has been a negligible return of office goers,” Kumar told Financial Express Online as he recalled how his daily hand-to-mouth life was hammered due to the Covid-induced work from home (WFH) set-up.

“Lockdown didn’t allow anyone (street vendors) to do business on streets and WFH situation uprooted them completely from their places that were their major source of earning. While there were many who started selling fruits and vegetables in residential areas, but they couldn’t sell much due to on-ground restrictions by local authorities. There won’t be many vendors without any loan taken either from friends and family or other informal credit sources after spending their savings. Absence of office crowd since last year have bereft them of a major chunk of their earnings,” Arbind Singh, National Coordinator, National Association of Street Vendors of India told Financial Express Online.

The daily sale, for instance, in Delhi was reduced to around 30 per cent. “If someone was earning Rs 500 selling sandwiches or paranthas a day before Covid, the income was reduced to not more than Rs 150-200 while situation now is gradually improving. The majority of street vendors, who had returned to their home town last year, have come back while only 20 per cent are still in their native towns. If there is a third wave and WFH continued, the impact would be devastating,” added Singh.

Likewise, the situation in Mumbai was grim. Of around 1.2 lakh hawkers or street vendors in the city, 15,000 were represented by Azad Hawkers’ Union. According to the union, post Covid, street vendors surrounding the office spaces in the city were completely out of business. “Businesses were completely shut. Also, there has been extortion from such vendors on a big scale here. How would they (vendors) survive? Except for vegetables, vendors were not allowed to sell anything,” Dayashankar Singh, President, Azad Hawkers’ Union told Financial Express Online.

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Debdulal Saha, who is currently the assistant professor of humanities and social sciences at the Indian Institute of Science Education and Research, Mohali, noted that the recovery for street vendors is significantly slow as the majority of offices continue to operate in a remote work environment. “WFH impact was big as vendors lost their natural markets to sell goods. Also, recovery would be very slow. Most vendors were either selling juice or food items. Even if work-from-office resumes, vendors are aware that people might not be fully confident in eating from them as they were before Covid,” Saha told Financial Express Online.

Importantly, the government had last June launched the PM SVANidhi scheme to offer working capital loan of up to Rs 10,000 for 12 months under the Atmanirbhar Bharat initiative to Covid-hit street vendors including hawkers selling fruits, vegetables, tea, footwear, local snacks, books, etc. Partner lending institutions had disbursed 24.61 lakh loan applications involving Rs 2,439 crore, as of September 6, 2021, from 27.14 lakh applications worth Rs 2,712 crore sanctioned, according to the data from the scheme’s portal by the Ministry of Housing and Urban Affairs. However, Saha said the credit limit of up to Rs 10,000 should be enhanced.

“Pan and cigarette shops will recover faster than food outlets. They will have to wait for a longer time until employees return to offices. For more support to street vendors in their recovery, the government should increase the credit limit under PM SVANidhi from Rs 10,000 to at least Rs 20,000 to Rs 30,000,” added Saha. In order to boost digital payments among street vendors, the Reserve Bank of India had last month had extended the Payments Infrastructure Development Fund (PIDF) Scheme to vendors covered under the PM SVANidhi scheme in Tier-I and Tier-II centres. The fund was announced by RBI back in January this year to encourage the deployment of Point of Sale (POS) infrastructure in Tier-3 to Tier-6 centres and northeastern states. PIDF has aimed to create 30 lakh new touchpoints every year for digital payments and would be operational for three years in the beginning.

Despite Covid-related concerns ebbing with increased vaccination count and reduced number of Covid cases, a number of businesses are looking to continue with remote work till next year even as it also depends on the possibility of the third wave. For instance, Google had extended WFH for its global locations till January 2022. Moreover, a global survey out in July this year by software company Zoho said that around 95 per cent of Indian firms are planning to continue with the remote working for the coming two years. Of the 1,210 IT executives and technology professionals surveyed from North America, the UK, Australia, New Zealand, Singapore, and India, 202 respondents from businesses with more than 500 employees were from India.

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