M1xchange facilitates financing of trade receivables of small firms

The TReDS allows MSMEs to receive money upfront, which helps them resolve their collection-related and working capital issues

You drop in at any seminar or workshop deliberating on MSMEs (micro, small & medium enterprises) and one inevitable point that comes up for discussion is addressing the financing needs of the sector.

The MSME sector, which generates the most number of jobs after the agriculture sector, continues to face constraints in obtaining adequate finance, especially in terms of their ability to convert trade receivables into liquid funds.

For facilitating the financing of trade receivables of MSMEs from corporate buyers through multiple lenders, the Reserve Bank of India (RBI) has introduced the Trade Receivables Discounting System (TReDS).

M1xchange, run by Gurugram-based Mynd Solutions,