Awareness of TReDs among MSMEs needs to improve: RXIL's MD & CEO

Ketan Gaikwad speaks about the potential of TReDs and issues involved

Since rolling out in 2017, the Receivables Exchange of India (RXIL) has cumulatively enabled financing of over ₹2.82 trillion across more than 16 million invoices, supporting over 59,000 micro, small and medium enterprises (MSMEs) with over 3,300 buyers, and more than 70 financiers on the platform. RXIL is the country’s first Trade Receivables Discounting System (TReDS) — a Reserve Bank of India (RBI) initiative — to solve the problem of delayed payments for MSMEs. Ketan Gaikwad, managing director (MD) and chief executive officer (CEO) of RXIL, speaks in an email interview with Raghu Mohan about the potential of TReDs and issues involved. Edited excerpts:

 

What will it take to achieve the goal to onboard a million firms on to the TReDS platforms over the next two years?

 

The TReDS reforms announced in the Union Budget will accelerate MSME participation. When large buyers and government procurement platforms participate, their vendor ecosystems, largely consisting of MSMEs, get onboarded. The onboarding process has also become highly streamlined. If MSMEs have the required documents ready, registration on TReDs can be completed in less than 10 minutes. However, policy support and technology alone are not enough. Continuous awareness and outreach are equally important. Many MSMEs are still unaware that they can unlock working capital by discounting approved invoices without providing additional collateral. Another key factor will be deeper participation from lenders. As more of them participate actively on TReDS platforms, liquidity improves and competitive bidding ensures that MSMEs receive financing at competitive rates. With supportive reforms, simplified onboarding, and stronger ecosystem participation, onboarding a million MSMEs on TReDS platforms over the next two years is an achievable goal.

 

How is RXIL positioning itself among TReDS platforms?

 

We account for nearly 35 per cent of the market and have financed about ₹80,500 crore to MSMEs in FY25 alone. Building on this momentum, the platform is targeting financing volumes of around ₹1.2 trillion in FY26. A key differentiator has been continuous technology innovation and enhancement of the end-to-end digital journey. RXIL has also expanded its footprint into global trade finance. Through RXIL Global, it operates the International Trade Finance Services platform at GIFT City.

 

Is there a case to extend the Credit Guarantee Fund Scheme for Factoring under National Credit Guarantee Trustee Company?

 

In our view, there may not be a strong case for doing so. Over the past few years, the scheme has seen limited adoption within the factoring ecosystem, and its practical utilisation has remained utilised. However, the Credit Guarantee Fund Trust for Micro and Small Enterprises under the new TReDS platform framework could play a much more meaningful role. By extending support to receivables financing transactions on TReDS, lenders could receive partial credit guarantees on financing extended to MSME suppliers. This would reduce the perceived risk for financiers, particularly in cases involving buyers with limited credit visibility. Such credit enhancement can significantly encourage wider participation from lenders. TReDS has evolved considerably in recent years with the introduction of multiple risk mitigation mechanisms. RBI’s regulatory framework in 2023 enabled participation of trade credit insurance companies as 4th  participant category.

 

It is felt that capacity building needs to improve. What can be done to deepen engagement with lenders on non-financial aspects?

 

Collaborative outreach programmes involving lenders, industry associations, and MSME clusters can help educate suppliers on receivables financing, digital onboarding, and effective use of platforms like TReDS. Many MSMEs still require guidance on invoice management, documentation practices, and the operational aspects of participating on digital trade finance platforms.

 

Your views on TReDS’ integration with Government e-Marketplace (GeM), goods and services tax (GST) network, e-invoicing, and the Account Aggregator (AA) framework.

 

It generates verified transaction data that lenders can use to understand business performance and repayment capacity. The proposed linkage between TReDS and GeM, expected to be operational by June 2026, will allow suppliers participating in government procurement to seamlessly finance receivables once the invoices are approved on the platform. Similarly, integrations with GST systems and e-invoicing will enable automated verification of underlying transactions, reducing fraud while improving transparency.  AA framework enhances the ecosystem by enabling consent-based data sharing between MSMEs and financial institutions.