Digital transactions have given rise to some unlikely yet niche collaborations, including the case of Trade Receivables Discounting System (TReDS), an electronic platform for MSMEs or Micro, Small and Medium Enterprises. The platform facilitates the financing or discounting of trade receivables of MSMEs through multiple financiers. These receivables can be due from corporates and other buyers, including government departments and Public Sector Undertakings (PSUs). “TReDS aims to bring transparency into the operations. Quite appropriate as MSMEs contribute to 30 per cent of the GDP. Still, they tend to encounter difficulties in procuring loans,” said Kailashkumar Varodia, chief financial officer, Receivables Exchange of India Limited, at Resurgent India’s recent virtual session, Unlocking New Frontiers: Exploring Growth Opportunities in Digital Lending.
Being digital, TReDS enables MSMEs to choose their loan amount through an automated paperless process...