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182 factoring companies for MSMEs now, up from seven earlier

The RBI has allowed all non-deposit taking NBFC-Investment and Credit Companies (NBFC-ICCs) with asset size of ₹1,000 crore and above to carry on with factoring business

Textile industy, manufacturing, msmes, jobs, workers, labour, rights
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The RBI has allowed all non-deposit taking NBFC-Investment and Credit Companies (NBFC-ICCs) with asset size of ₹1,000 crore and above to carry on with factoring business, significantly boosting the number of such companies to 182 from seven earlier. Factoring companies offer bill discounting facilities to MSMEs. These can trade their receivables online and get immediate payment from factoring companies at a discount. This enables them to get immediate liquidity instead of waiting for the bills to be honoured by the customers.

However, if the customer doesn’t honour the bills, the MSME may still be liable for repayment to the factors.  

The had
Topics : MSMEs

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First Published: Jan 21 2022 | 12:53 AM IST

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