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RBI issues directions on TReDS platforms to ease MSME access, support lenders
Jun-24-2026

With an aim to simplify the onboarding process for MSME sellers and enable financiers to avail credit guarantees for their exposures, the Reserve Bank of India (RBI) has issued final directions on Trade Receivables Discounting System (TReDS) platforms. Trade Receivables Discounting System is an online platform which helps small businesses auction their invoices or trade receivables to banks and other financial institutions to unlock working capital.

The RBI said ‘An applicant shall have a minimum net worth of Rs 25 crore and shall submit a certificate in the format from its statutory auditor.’ Existing entities authorised to operate the TReDS platform will have to ensure that networth criterion is met by March 31, 2028. Also, the minimum net worth shall be maintained on an ongoing basis. It stated the TReDS platform should bring participants together to facilitate the uploading, bidding, discounting, and settlement of sellers’ invoices and bills.  

It noted that the platform should put in place a suitable mechanism to establish the genuineness of the uploaded invoices/bills. The RBI said ‘The platform shall facilitate efficient and seamless settlement of transactions between financier and seller for financing of trade receivables and between buyer and financier on the due date, using any authorised payment system.’ Seller means micro, small and medium enterprise (MSME). A financier refers to entities or institutions allowed to undertake factoring business. MSMEs face constraints in obtaining adequate finance, particularly in terms of their ability to convert their trade receivables into liquid funds. To address the issue, the RBI has, over time, authorised the setting up of TReDS platforms to facilitate financing of trade receivables of MSME sellers.


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