RBI Revises Onboarding For MSMEs On Trade Receivables Platform

02 Jul 2026 CW Team

The directions require a minimum net worth of Rs 250 million (Rs 250 mn) for entities providing discounting services, and this figure must be certified by a statutory auditor. Existing entities offering the service have been given until March 31 2028 to meet the net worth criterion. The directions also set out operational norms and reporting obligations to support oversight.

TReDS is an online platform that enables small businesses to auction invoices and trade receivables to banks and other financiers in order to unlock working capital. The regulator emphasised that the platform shall facilitate efficient and seamless settlement of transactions between financier and seller for financing of trade receivables and between buyer and financier on the due date using any authorised payment system. The directions clarify settlement responsibilities and seek to reduce frictions in invoice financing. Operators will be required to adhere to settlement timelines and record keeping mandates to facilitate auditability.

The measure is intended to help MSMEs receive payments from their customers where they might face constraints in converting receivables to cash, thereby improving liquidity management. By tightening eligibility and standardising certification, the regulator aims to strengthen trust in the platforms and encourage wider participation by financiers. Market participants are likely to adjust operations to meet the certification and net worth requirements ahead of the deadline. Overall, the changes are designed to support more predictable cash flows for smaller firms.

Reserve Bank of India issued final directions on the Trade Receivables Discounting System (TReDS) on June 23 2026 as part of measures to simplify the platform for micro, small and medium enterprises. The regulator set out eligibility and operational requirements intended to streamline onboarding and transaction processing. The move forms part of broader efforts to enhance access to formal financing for smaller firms. The directions require a minimum net worth of Rs 250 million (Rs 250 mn) for entities providing discounting services, and this figure must be certified by a statutory auditor. Existing entities offering the service have been given until March 31 2028 to meet the net worth criterion. The directions also set out operational norms and reporting obligations to support oversight. TReDS is an online platform that enables small businesses to auction invoices and trade receivables to banks and other financiers in order to unlock working capital. The regulator emphasised that the platform shall facilitate efficient and seamless settlement of transactions between financier and seller for financing of trade receivables and between buyer and financier on the due date using any authorised payment system. The directions clarify settlement responsibilities and seek to reduce frictions in invoice financing. Operators will be required to adhere to settlement timelines and record keeping mandates to facilitate auditability. The measure is intended to help MSMEs receive payments from their customers where they might face constraints in converting receivables to cash, thereby improving liquidity management. By tightening eligibility and standardising certification, the regulator aims to strengthen trust in the platforms and encourage wider participation by financiers. Market participants are likely to adjust operations to meet the certification and net worth requirements ahead of the deadline. Overall, the changes are designed to support more predictable cash flows for smaller firms.

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