M1xchange to Add MSMEs for Growth

Kolkata, Aug 19 (PTI) M1xchange, a digital invoice discounting platform with TreDS, on Tuesday said it plans to add more MSMEs to drive growth by facilitating working capital requirements of the sector.

The platform has already facilitated digital bill discounting of over 60,000 MSMEs, and onboarding around 12,000 medium, small and micro units every month to facilitate financing of trade receivables, an official of M1xchange said.

Senior Director Kaustubh Srivastava told reporters here that the RBI has allowed digital bill discounting in 2017 and the entire process is monitored by the central bank.

He said a total of 69 banks, including nationalised, private and foreign lenders, participate in the bidding process to finance the MSMEs when the bills are uploaded on the digital platform.

While big corporates are usually the purchasers of the products and services of the MSMEs, they give credit facilities up to a maximum of 180 days within which the bills are discounted and paid to them through the bidding process.

M1xchange also has 3,000 big and mid-sized corporates on its Trade Receivables Electronic Discounting System (TReDS) platform, he said.


Srivastava said around Rs 10,000 crore worth of digital bill discounting takes place on the M1xchange platform every month, adding that the cumulative amount since its start of operations stood at Rs 2 lakh crore.

The platform charges a nominal fee for every transaction made on the exchange, he said.

Srivastava said the digital platforms for bill discounting help the MSMEs to recover money from their clients and manage their cash flows efficiently.

Besides banks, NBFCs are also part of the platform, he said.

Referring to West Bengal, which has a strong presence of MSMEs, he said the exchange has made significant inroads into the state. The exchange has facilitated around Rs 20,000-crore transactions in West Bengal, he said.

Srivastava said MSME credit in the state is projected to cross Rs 2 lakh crore in the current financial year.

Most of the MSMEs in the country are concentrated in the states of West Bengal, Uttar Pradesh, Rajasthan, Tamil Nadu and Maharashtra.