Government Moves To Accelerate MSME Payments Through TReDS Mandate
ECONOMY & POLICY

Government Moves To Accelerate MSME Payments Through TReDS Mandate

The government has announced a mandate to expand the use of the Trade Receivables Discounting System, TReDS, to accelerate payments to micro, small and medium enterprises. The measure is designed to shorten receivable cycles and to strengthen liquidity for suppliers across sectors. Under the proposal, buyers and financiers will route eligible invoices through registered TReDS platforms so that invoices can be discounted and settled faster than under conventional payment terms.

The rule is intended to make cash conversion more predictable for smaller firms that often face long payment delays from larger corporates and public sector purchasers. TReDS platforms will provide a marketplace where financiers and investors can bid to purchase receivables, reducing dependency on traditional bank lending. Faster conversion of invoices into cash is intended to ease working capital constraints and to lower the cost of short term credit for suppliers.

The policy also aims to broaden access to formal credit for firms that are currently reliant on informal financing arrangements. Implementation will rely on strengthened regulatory oversight of TReDS operators and on wider onboarding of buyers and sellers onto digital platforms. Regulators will monitor compliance and will work with industry bodies to ensure interoperability between systems and to reduce onboarding friction.

The mandate will require changes in corporate procurement practices and in internal payment cycles for large buyers to align with electronic settlement processes. The government will provide guidance and support measures to help smaller firms adopt digital invoice financing and to streamline registration on TReDS platforms. Broader uptake of TReDS is intended to accelerate the formalisation of supply chains and to smooth cash flows across tiers of suppliers.

The government has announced a mandate to expand the use of the Trade Receivables Discounting System, TReDS, to accelerate payments to micro, small and medium enterprises. The measure is designed to shorten receivable cycles and to strengthen liquidity for suppliers across sectors. Under the proposal, buyers and financiers will route eligible invoices through registered TReDS platforms so that invoices can be discounted and settled faster than under conventional payment terms. The rule is intended to make cash conversion more predictable for smaller firms that often face long payment delays from larger corporates and public sector purchasers. TReDS platforms will provide a marketplace where financiers and investors can bid to purchase receivables, reducing dependency on traditional bank lending. Faster conversion of invoices into cash is intended to ease working capital constraints and to lower the cost of short term credit for suppliers. The policy also aims to broaden access to formal credit for firms that are currently reliant on informal financing arrangements. Implementation will rely on strengthened regulatory oversight of TReDS operators and on wider onboarding of buyers and sellers onto digital platforms. Regulators will monitor compliance and will work with industry bodies to ensure interoperability between systems and to reduce onboarding friction. The mandate will require changes in corporate procurement practices and in internal payment cycles for large buyers to align with electronic settlement processes. The government will provide guidance and support measures to help smaller firms adopt digital invoice financing and to streamline registration on TReDS platforms. Broader uptake of TReDS is intended to accelerate the formalisation of supply chains and to smooth cash flows across tiers of suppliers.

Related Stories

Gold Stories

Next Story
Real Estate

Anshul Singhal launches Vantrock with Rs 42 billion development plan

Real estate professional Anshul Singhal has launched Vantrock Real Assets Private Limited (VRAPL), a Mumbai-headquartered platform focused initially on warehousing, industrial and logistics parks. The company plans to develop approximately 11.5 million sq ft of assets, with an estimated gross development value (GDV) of Rs 42 billion (approximately USD 434 million) on completion.The first phase will cover around 3 million sq ft across the National Capital Region (NCR), Bengaluru and Pune, with an estimated development value of Rs 11 billion (approximately USD 113 million). Construction is sched..

Next Story
Infrastructure Transport

Afcons wins CII award for biodiversity management

Afcons Infrastructure has received the Confederation of Indian Industry (CII) National Award for Environmental Best Practices 2026 in the Biodiversity Management category for its work on the Mumbai-Ahmedabad High Speed Rail Project’s C-2 package.The award was presented at a ceremony in Chennai on 9 October 2026. It was received by Mihir Mishra, Vice-President, CPE, and Sumon Paul, Assistant General Manager, HSE, along with the Afcons team.The project adopted several resource recovery and waste management practices. These included recycling concrete washout waste to recover sand, aggregates a..

Next Story
Technology

Indian businesses lead globally in planned AI investment, says Autodesk

Indian organisations are moving towards deeper integration of artificial intelligence (AI), digital technologies and sustainability into business operations, according to Autodesk’s 2026 State of Design & Make report. The fourth edition of the annual study highlights growing AI adoption, measurable outcomes from digital transformation and the role of sustainability in long-term business growth.The report found that 64 per cent of Indian organisations are approaching or have achieved their current AI goals. While 88 per cent believe AI will enhance their industry, up from 78 per cent in 2..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code