Latest news with #TradeReceivablesDiscountingSystem
Mint
30-06-2025
- Business
- Mint
GST completes eight years: Good for govt, good for business
New Delhi: With 15 million registered taxpayers and robust growth in the revenue receipts, the Goods and Services Tax (GST) ecosystem is continuing to evolve with a focus on ease of doing business, better compliance and wider economic participation, the finance ministry said on Monday as the indirect tax system completed eight years. Annual revenue from GST, introduced on 1 July 2017, has doubled to ₹ 22.08 trillion in FY25 from five years ago and micro, small and medium enterprises are finding easier access to credit, the ministry said. In FY21, the combined Central and state GST revenue collection was ₹ 11.37 trillion. The ministry's emphasis on ease of doing business, compliance and wider economic participation comes at a time Central and state governments are preparing for reforms in the GST architecture by reducing the slabs and reallocating goods and services, which are on the 12% slab, to 5% and 18%. The move is expected to simplify the rate structure and address anomalies such as certain raw materials and intermediate products facing a higher tax burden than the finished products. GST has brought major relief to micro, small and medium enterprises, the ministry said adding the tax regime had opened doors for easier access to credit. The ministry said that TReDS or Trade Receivables Discounting System—online platforms where small enterprises can sell their unpaid invoices to banks to get quick cash—have helped improve access to credit by these businesses. More than 5,000 buyers and over 53 banks and 13 non-banking finance companies are registered as financers on the four TReDS platforms in the country. The GST regime delivered substantial progress in integrating markets, enhancing compliance, and leveraging digital tools for administration and enforcement but the journey ahead demands a renewed focus on simplification of the tax structure, ensuring stability in policies and building deeper trust among all stakeholders, PricewaterhouseCoopers said on Monday in a review of the tax system. The next phase of GST must prioritize rationalizing rates, reducing blocked tax credits, broadening the tax base and removing procedural bottlenecks, the consulting company said. Experts said the industry is looking forward to GST appellate tribunals being operationalized for quick resolution of disputes. The changes in the tax system so far have played a crucial role in reducing litigation and simplifying procedures. However, the wait for a functional GST appellate tribunal continues, said Manoj Mishra, tax controversy, management leader, Grant Thornton Bharat. 'While the structure is now in place, its effectiveness will depend entirely on how efficiently it is implemented. Broader issues like rate rationalization and inclusion of petroleum products remain on the table. As we look ahead, the journey is far from over, but the direction is right and the momentum isbuilding,' said Mishra.
Deccan Herald
27-06-2025
- Business
- Deccan Herald
Five mantras India's MSMEs must follow to scale up
As the world gears up to celebrate the MSME Day, the micro, small, and medium enterprises (MSMEs) in India stand at transformative from April 1, the classification limits for MSMEs have been raised dramatically: with the investment caps increased by 2.5 times and the turnover limits doubled. Micro enterprises can now have investments in plant and machinery or equipment up to ₹2.5 crore, and record turnover up to ₹10 crore, while small enterprises can go up to ₹25 crore and up to ₹10 crore respectively, and medium enterprises can scale up to ₹125 crore in investment and ₹500 crore in turnover. The move is a shot in the arm for MSMEs, helping them scale up without losing access to government sops for the sector. It also serves as a boost to job creation and capital growth ambitions are fuelled on the one side, the MSME sector is riddled with several challenges that continue to cast a long shadow over the sector's progress: the persistent problem of lower bargaining power vis-à-vis their bigger customers, resultant delayed payments and liquidity crises, inability to withstand competition from big players who can harness the benefits of economies of scale, unorganised and informal nature of operations, slower adoption of technology, relative inaccessibility of low-cost funding options, to name a considering scheme to help MSME exporters register goods in new markets: up brings new complexities and risks: larger operations, more employees, wider supply chains, and more exposure to market fluctuations. Hence, to scale up confidently, MSMEs must learn to straddle both resilience-building and growth resilience in MSMEs requires a comprehensive multi-pronged approach. The pandemic, for one, taught us that resilience is not a luxury but a Funding and Prudent Credit Management: To scale up, MSMEs need new funding. With enhanced credit guarantee schemes, roll out of credit card facilities for MSMEs, bill-discounting facilities, especially the TReDS platform (Trade Receivables Discounting System), and digital lending platforms, the sector now has more options than before. However, prudent financial management is keep the cost of capital minimum and to avoid mismatch of cash inflows and outflows, MSMEs should diversify funding sources and judiciously mix and match them. This also avoids over-reliance on any single funding channel. Maintaining healthy cash reserves and tracking receivables are evergreen essentials, especially given the challenge of delayed Transformation: Digital adoption is no longer optional. Implementing cloud-based accounting, ERP (Enterprise Resource Planning) and basic GRC (Governance, Risk and Compliance) systems, will help streamline operations, build better internal controls, and ring in good governance. It sure will entail initial cash outflows, but it will pay for itself many times over, by building reliable systems that infuse growth with for software-as-a-service or infrastructure-as-a-service models offers flexibility to scale up or down as needed, on demand and on the go. Embracing agentic AI and generative AI in various processes can simplify and strengthen processes, while AI-driven analytics can help MSMEs predict market trends and manage risks proactively. E-commerce platforms and digital marketing avenues can open new revenue streams, and reduce dependence on local markets, providing a buffer against the vagaries of local Chain and Market Diversification: As growth beckons, building resilient supply chains is indispensable. MSMEs must build relationships with multiple suppliers, explore local sourcing as well as imports, wherever appropriate, and leverage digital procurement tools to ensure seamless on-tap procurement. Similarly, on the downstream side of the supply chain, exploring new distribution channels, and tapping into export markets or diversifying into different regional customer bases can help spread risk while unlocking new growth and Compliance: As MSMEs scale, robust governance becomes critical. This is more so if MSMEs want to approach private equity or hit the public market through equity IPOs, which will give access to large capital without necessitating interest payments or mandatory repayments. Regular statutory and internal audits, tax and labour law compliance, robust accounting, and adherence to other legal and regulatory requirements demonstrate accountability, build investor confidence, and help prevent governance Adopting sustainable practices like energy efficiency, waste reduction, ethical sourcing and hiring practices, can have a multiplier effect on resilience. Not just that, sustainable practices are increasingly demanded by end customers and investors. Embracing sustainability and demonstrating it through sustainability reporting not only reduces operational risks but also enhances brand value and opens doors to new road ahead for MSMEs is lush with opportunities, while also being freckled with risks. It is all about dreaming with eyes open, while staying grounded, and keeping the business guarded against the known unknowns and the unknown unknowns. For now, it is time to celebrate India's entrepreneurial spirit with renewed fanfare and Ganapathy Subramanian is a Chennai-based practising company secretary, and Ranjith Krishnan is a Thane-based sustainability The views expressed above are the author's own. They do not necessarily reflect the views of DH.
Economic Times
19-06-2025
- Business
- Economic Times
How M1xchange is revolutionising MSME financing in India
Live Events M1xchange has emerged as a galvanising force in financing for Indian MSMEs, fundamentally transforming how micro, small, and medium enterprises access working capital through its innovative Trade Receivables Discounting System (TReDS) platform. As an RBI-approved digital marketplace, M1xchange has successfully bridged the critical financing gap besets India's MSME impact of M1xchange is reflected in its growth trajectory and scale of operations. The platform has facilitated bill discounting worth over Rs 170,000 crore, demonstrating its role in unlocking liquidity for thousands of small businesses across the country. It has onboarded an impressive ecosystem comprising over 65 banks and non-banking financial companies (NBFCs), and 50,000-plus MSMEs, creating a comprehensive network spanning multiple geographies and industries. Over 2,500 corporates, including IndianOil, NTPC, Hindustan Aeronautics Ltd, Mother Dairy, Bharat Petroleum, and TVS, are registered on the of M1xchange's foremost contributions has been addressing the chronic problem of delayed payments,which significantly affect MSME cashflows. By providing a digital marketplace where MSMEs can sell their trade receivables to financial institutions at competitive rates, the platform has enabled businesses to convert outstanding invoices into immediate working capital. This transformation is particularly crucial for MSMEs that struggle with cashflow constraints while waiting for corporate buyers to settle user-friendly digital infrastructure of M1xchange has also democratised MSMEs' access to formal financing. The transaction process begins when MSME suppliers raise invoices, and extends through the entire discounting cycle, eliminating bureaucratic hurdles and reducing processing times. MSMEs can now access collateral-free invoice financing within 24 hours, a remarkable improvement from conventional lending timelines.M1xchange's competitive advantage lies in its ability to offer MSMEs favourable discount rates ranging between 7-10%, which are substantially lower than the 12-20% interest rates they'd have to pay through traditional financing channels. This cost reduction directly translates into improved profitability and business sustainability for small performance metrics underscore M1xchange's growing influence. In FY24 alone, it facilitated invoice discounting worth Rs 43,000 crore, a significant jump from Rs 23,100 crore in FY23. This exponential growth reflects increasing adoption among MSMEs, corporates, and financial institutions, signalling a fundamental shift in how India's small business sector is approaching working capital platform's success extends beyond mere transaction volumes. By creating a transparent, efficient, and secure marketplace for trade receivables, M1xchange has also enhanced the creditworthiness perception of MSMEs among financial institutions. This improved access to formal credit channels has enabled MSMEs to scale, invest in technology, and be more competitive in domestic and international the magnitude of positive change it has introduced has earned M1xchange a slew of laurels, such as the MSME Enabler Award for Banking & Financing at the ET MSME Awards 2024 — India's most influential MSME awards initiative. Others include 'Fintech Leader of the Year' at the Bharat Fintech Summit 2025 and 'Best Fintech For Serving MSMEs' at the FICCI MSME Ecosystem 2022 awards.M1xchange is more than a financing platform: it embodies the digital transformation of India's MSME sector. By leveraging technology to solve traditional financing challenges, it has created a sustainable ecosystem that supports entrepreneurship, promotes financial inclusion, and contributes significantly to India's economic more winner vignettes of the ET MSME Awards , keep an eye on this space.
Time of India
19-06-2025
- Business
- Time of India
How M1xchange is revolutionising MSME financing in India
M1xchange has emerged as a galvanising force in financing for Indian MSMEs, fundamentally transforming how micro, small, and medium enterprises access working capital through its innovative Trade Receivables Discounting System (TReDS) platform. As an RBI-approved digital marketplace, M1xchange has successfully bridged the critical financing gap besets India's MSME ecosystem. The impact of M1xchange is reflected in its growth trajectory and scale of operations. The platform has facilitated bill discounting worth over Rs 170,000 crore, demonstrating its role in unlocking liquidity for thousands of small businesses across the country. It has onboarded an impressive ecosystem comprising over 65 banks and non-banking financial companies (NBFCs), and 50,000-plus MSMEs, creating a comprehensive network spanning multiple geographies and industries. Over 2,500 corporates, including IndianOil, NTPC, Hindustan Aeronautics Ltd, Mother Dairy, Bharat Petroleum, and TVS, are registered on the platform. One of M1xchange's foremost contributions has been addressing the chronic problem of delayed payments,which significantly affect MSME cashflows. By providing a digital marketplace where MSMEs can sell their trade receivables to financial institutions at competitive rates, the platform has enabled businesses to convert outstanding invoices into immediate working capital. This transformation is particularly crucial for MSMEs that struggle with cashflow constraints while waiting for corporate buyers to settle payments. The user-friendly digital infrastructure of M1xchange has also democratised MSMEs' access to formal financing. The transaction process begins when MSME suppliers raise invoices, and extends through the entire discounting cycle, eliminating bureaucratic hurdles and reducing processing times. MSMEs can now access collateral-free invoice financing within 24 hours, a remarkable improvement from conventional lending timelines. M1xchange's competitive advantage lies in its ability to offer MSMEs favourable discount rates ranging between 7-10%, which are substantially lower than the 12-20% interest rates they'd have to pay through traditional financing channels. This cost reduction directly translates into improved profitability and business sustainability for small enterprises. Live Events Recent performance metrics underscore M1xchange's growing influence. In FY24 alone, it facilitated invoice discounting worth Rs 43,000 crore, a significant jump from Rs 23,100 crore in FY23. This exponential growth reflects increasing adoption among MSMEs, corporates, and financial institutions, signalling a fundamental shift in how India's small business sector is approaching working capital management. The platform's success extends beyond mere transaction volumes. By creating a transparent, efficient, and secure marketplace for trade receivables, M1xchange has also enhanced the creditworthiness perception of MSMEs among financial institutions. This improved access to formal credit channels has enabled MSMEs to scale, invest in technology, and be more competitive in domestic and international markets. Unsurprisingly, the magnitude of positive change it has introduced has earned M1xchange a slew of laurels, such as the MSME Enabler Award for Banking & Financing at the ET MSME Awards 2024 — India's most influential MSME awards initiative. Others include 'Fintech Leader of the Year' at the Bharat Fintech Summit 2025 and 'Best Fintech For Serving MSMEs' at the FICCI MSME Ecosystem 2022 awards. M1xchange is more than a financing platform: it embodies the digital transformation of India's MSME sector. By leveraging technology to solve traditional financing challenges, it has created a sustainable ecosystem that supports entrepreneurship, promotes financial inclusion, and contributes significantly to India's economic growth. For more winner vignettes of the ET MSME Awards , keep an eye on this space.
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Business Standard
08-06-2025
- Business
- Business Standard
TReDS platform M1xchage eyes IPO in 3-5 years, aims ₹1.25 trn biz in FY25
M1xchage, a leading RBI-licensed Trade Receivables Discounting System (TReDS) platform, which is witnessing an 80-90 per cent annual growth in business, is planning to go public in the next 3-5 years. "Although the company has been profitable for the last two years, the initial public offering (IPO) is still a few years away. We would look at an IPO in 3-5 years, depending on market conditions," M1xchange Chief Executive Officer Sundeep Mohindru told PTI. M1xchage, which started operations in 2017, is aiming to close the financial year with a business of Rs 1.25 trillion. Factoring as a business is picking up very well as it is win-win for the banks, buyers and sellers, he said, adding that the business has been witnessing a growth of 80-90 per cent on an annual basis. During the current financial year, he said the business is expected to reach Rs 1.25 trillion. Last year, the volume was to the tune of Rs 78,000 crore as compared to Rs 43,000 crore in FY24. The platform is facilitating invoice financing of nearly Rs 10,000 crore each month, enabling MSMEs with faster access to working capital and driving adoption across corporates, vendors, and financial institutions. India's supply chain finance sector is witnessing accelerated growth, driven by the need for faster-working capital access for MSMEs and digital transformation across industries. With the Reserve Bank of India's (RBI's) TReDS framework, digital platforms are increasingly becoming the backbone of MSME financing, he said. The platform facilitates discounting of invoices and bills of exchange, or trade receivables of micro, small and medium enterprises from corporate and other buyers, through multiple financiers such as banks and non-bank entities. Factoring or invoice discounting refers to transfer in ownership or financing of accounts by a third party or factor at a discount for commission and fees, wherein the factor makes a profit upon the settlement of the debt. About funding for business growth, Mohindru said the company is well capitalised at the moment to drive exponential growth. Recently, growth-stage investment firm Filter Capital invested about $10 million (Rs 85 crore) in trade receivables discounting system platform M1xchange. Prior to this, Jindal Stainless, leading stainless steel manufacturer, along with its wholly owned subsidiary, Jindal Stainless Steelway Ltd, acquired a 9.62 per cent stake in M1xchange. This deal involved a combination of primary capital and a secondary purchase of shares from existing shareholders. (Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
