Discounting platform M1xchange raises $10mn funding from Amazon, others

TReDS platform M1xchange on Thursday said it has raised USD 10 million in funding, led by e-commerce major Amazon.

The funding round also saw participation from BEENEXT and existing investor, Mayfield, a statement said.

Last year, M1xchange had raised USD 4.5 million (about Rs 33 crore) in funding from Beenext Asia, Singapore and Mayfield.

The TReDS platform facilitates micro, small and medium enterprises (MSMEs) to get a payment of their invoices raised to their corporate customers from banks in 72 hours. The banks make the payment to MSMEs on invoices presented before them through TReDS based on the credit record of the corporate, and the payment is later made by the corporate to the banks.

Since its launch over three years ago, M1xchange has discounted invoices totalling USD 1.7 billion across 10,000 MSME suppliers.

"We are proud to welcome a global technology company like Amazon to join us as a shareholder in our goal to become a leader in supply chain finance. Over the last decade, India has gone through a sea change in the enormous number of MSMEs now selling their wares online," Sundeep Mohindru, Chief Executive Officer of M1xchange, said.

He added that the company's approach to supply chain finance will also benefit the large ecosystem of vendors built by Amazon in India.

"This investment comes at a time when M1xchange is working towards integrating this secured marketplace for receivables financing with other government digital initiatives. With this new funding, we plan to further expand our reach beyond the 352 cities from where MSMEs currently enjoy the benefit of discounted invoices," he said.

Amazon SVP and Country Head India Amit Agarwal said MSMEs are the backbone of India's economy.

"Today over 7 lakh sellers sell on the Amazon India marketplace, a majority being MSMEs. We are continuously exploring different ways to help MSMEs scale their business and grow. As we continue to focus our efforts to realise our pledge of digitising 10 million MSMEs by 2025, we believe an efficient digital exchange like M1xchange will encourage many more MSMEs to adopt e-commerce to access a nationwide customer base," he added.

Earlier in the day, e-commerce giant Amazon announced a USD 250 million (about Rs 1,873 crore) fund that will focus on digitising small and medium businesses and driving innovation in the areas of agri-tech and health-tech in India. The investment in M1xchange has been made via this venture fund.

M1xchange connects MSMEs with banks and financiers (and vice versa) through the marketplace exchange and an MSME can assign its invoice dues to a bank or financier and receive financing at better rates, thereby, solving the payments challenge for MSMEs, Amazon said in its statement.

Maple Capital Advisors helped M1xchange in this round of investment.