TReDS can be a lifeline for small businesses

The government and its enterprises are the single largest agencies that procure goods from MSMEs. They need to use the Trade Receivables Discounting System to make timely payments to such businesses

Micro, small and medium enterprises (MSMEs) are vital towards building a $5 trillion economy. The pandemic saw many MSMEs face a massive liquidity crunch, and this makes TReDS (Trade Receivables Discounting System) a key platform to revive the economy by providing financing to small businesses.
 
Central public sector enterprises (CPSEs) are mandated by the government to procure at least 25 per cent of their purchases from MSMEs and to register on TReDS. Since the government and its CPSEs are the single largest institutions that procure from MSMEs, their potential to promote its use and grow the transaction volumes on