How TReDS is revolutionising payments for MSMEs in India

Mumbai: A new online system is helping small businesses in India get paid faster, according to the Reserve Bank of India (RBI). The system, called TReDS, allows small businesses to sell unpaid invoices to banks and other financial institutions.

“TReDS has effectively bridged the credit gap by enabling MSMEs to promptly convert their trade receivables into liquid funds. This ensures that small businesses do not have to wait endlessly for payments,” said RBI Deputy Governor Michael Patra.

Small businesses often struggle to get paid on time by their larger customers. This delay can make it hard for them to pay their own bills and grow their businesses.


TReDS helps solve this problem by giving small businesses quick access to cash. This allows them to continue operating and investing in their growth.

The system has been a success, with the value of invoices financed through TReDS increasing significantly. The RBI also reports that around 5,000 financial technology companies are now using TReDS to help businesses manage their finances.