Page 27 - Banking Finance February 2022

ARTICLE

This turnover criterion may be further lowered, infact
all the big corporate and business must join TReDS and
strict government monitoring should be in place to pay
invoice only through online TReDS platform, will
definitely popularize the scheme and resolve the
perennial issue of liquidity problem amongst MSMEs.
The Cabinet approval on 20.08.2020, to allow all NBFCs
to give discount loans to MSME, is among one of the
series of measures taken by the Government to ease
the cash flow to MSMEs amid global pandemic
SIDBI has set up a fund to support free on-boarding for
micro, small and medium enterprises (MSMEs) on trade
receivables discounting system (TReDS). Exchange
Way forward for TReDS Partners RXIL, Invoicemart & M1xchange are offering
Continuous government support and awareness can go free registration to MSME unit for on-boarding in TReDS
a long way in countering the challenges being platform till 30.9.2020.
experienced. The government has taken several All advances under TReDS are categorized as Priority
initiatives recently to boost the TReDS exchanges.
Sector Lending for banks who participate, thus widening
Ministry of Micro, Small & Medium Enterprises, vide its scope of PSL finance. Banks/NBFCS/ FIs have also
Notification dated November 02, 2018 has mandated developed and marketing this product to on-board
all companies (Large Corporates) registered under the Corporate and MSME client to their fold to maximize
Companies Act, 2013 with a turnover of more than Rs. their share of PSL and strengthening customer base.
500 Crore (Rupees five hundred crore), and all Central
Advertisement on various channels such as Television,
Public Sector Enterprises (CPSEs) to get themselves Radio and social media by RBI to educate MSMEs and
registered on the TReDS Platform to ensure cash Corporates about the benefits of TReDS.
liquidity for MSME Suppliers.
Many of the Banks/NBFCs are running various
In a recent meeting, PMO has strictly advised all the awareness programme, MSME connect programmes,
CPSEs to complete the mandatory on boarding of the Webinars etc to create awareness among the MSMEs
vendor onto TReDS. Further, these CPSEs had to submit to maximize the use of TReDS platform.
the compliance report to the Department of Public
Enterprises (DPE) by August'2020. Moreover, ministries The phenomenal growth of business in TReDS platform
exercising administrative controls over these Corporates over the years is showing a positive sign in popularizing
were asked to monitor the progress and ensure the scheme. However, the Covid pandemic has halted
compliance within the new deadline. the growth, but again, it is a temporary phase and is
expected be over within sort span of time. Further, the
Additional Secretary, DPE has also stated that, "In aggressive marketing of the TReDS partners to on-board
order to enable the MSME suppliers to avail the maximum of MSMEs and Corporate Buyers and
benefit of TReDS portal, the CPSEs will ensure that Financiers will mark a success in future. Major PSBs like
after the delivery of goods or rendering of SBI, UBI, BoB, PNB etc have joined hand with these
services, the decision on acceptance /rejection of the
three platform partners to provide hassle free discount
goods/ services and the respective bills/ invoices will loan to MSMEs.
be taken within 15 days` of the delivery of the goods/
rendering of services". This is in line with Section 2 "Views and opinions expressed in the article are mine and
(ii) of MSMED Act, 2006, wherein it is provided that not of the Bank".
in case no objection is made by the buyer regarding References:
acceptance of goods and services within 15 days
i) msme.gov.in
from the date of delivery of the goods/ rendering
of services, it would be treated as "deemed ii) www.sambandh.msme.gov.in
acceptance". iii) www.rxil.com

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