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    Question

    The TReDS has been instrumental in improving the working

    capital funding needs of MSMEs. What does TReDS stand for ?
    A Trade Related electronic Disclosure System Correct Answer Incorrect Answer
    B Trade Receivable electronic Discounting System Correct Answer Incorrect Answer
    C Term Related electronic Development System Correct Answer Incorrect Answer
    D Trade Receivable electronic Development System Correct Answer Incorrect Answer
    E Trade Receivable electronic Disclosure System Correct Answer Incorrect Answer

    Solution

    TReDS (Trade Receivables Electronic-Discounting System) is an online platform that helps Micro, Small, and Medium Enterprises (MSMEs) finance their trade receivables. It allows MSMEs to discount their invoices and bills of exchange to large corporations, which can help them reduce working capital needs, improve liquidity, and manage cash flow better.   The concept of TReDS to facilitate the financing of trade receivables of MSMEs was introduced by the RBI in 2014. As of 2025, the RBI, has issued licence to five players – RXIL, Invoicemart , M1Xchange , C2FO Factoring Solutions and KredX .   As per the government directive, all companies with turnover exceeding Rs. 250 Crores shall register themselves on the TReDS platform before 31 st  March 2025.  

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