Focus on buyer-backed credit structure and regulatory support to scale receivables financing

Strengthening mechanisms for timely payments to MSMEs, particularly through enhancements to the Trade Receivables Discounting System (TReDS), can significantly improve liquidity access and business resilience in uncertain economic conditions.

Recent regulatory developments are aimed at simplifying MSME onboarding, expanding lender participation, and addressing delays in receivables—helping unlock substantial working capital currently tied up across the ecosystem.

However, delayed payments continue to remain a structural challenge, with many MSMEs hesitant to escalate disputes due to the risk of straining business relationships. In this context, digital platforms like TReDS play a critical role in enabling seamless and timely access to financing.

Commenting on the evolving framework, Mr. Ketan Gaikwad, Managing Director & CEO, Receivables Exchange of India Ltd (RXIL), said, “The fundamental structure of TReDS remains intact, with credit risk anchored on the buyer, enabling scalability while maintaining strong credit discipline.”

The continued policy focus on strengthening TReDS underscores its growing importance in improving cash flow visibility, enhancing credit access, and supporting the long-term sustainability of MSMEs.

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