Factoring Regulation Bill to open more credit facilities for MSMEs: FM

The amendments approved by Rajya Sabha Thursday will give an impetus to the economy by providing an efficient working capital cycle for MSMEs, Sitharaman said.

The Factoring Regulation (Amendment) Bill, 2021 will expand credit facilities for small businesses, and will help them in accessing funds from 9,500 non-banking financial companies (NBFC), Finance Minister Nirmala Sitharaman tweeted.

The amendments approved by Rajya Sabha Thursday will give an impetus to the economy by providing an efficient working capital cycle for micro, small and medium enterprises (MSMEs), Sitharaman said.

The Bill seeks to increase the number of NBFCs offering factoring service to over 9,500 from from seven currently. Factoring is a transaction where a business sells its receivables from a customer to a third party or a ‘factor'