Question

Why are scheduled commercial banks highly incentivized to actively participate and bid aggressively at low interest/discount rates on a TReDS platform?

A The RBI offers banks direct interest subvention grants for every invoice cleared on TReDS.
B TReDS trades are classified as sovereign-backed transactions carrying a 0% risk weight under Basel III guidelines.
C Invoices discounted on TReDS, where the underlying assignor is an MSME, are eligible for classification under the bank's Priority Sector Lending (PSL) targets.
D Bidding on TReDS permits banks to bypass mandatory statutory cash reserves (CRR) allocations.
E Financiers receive equity warrants in the buying corporate entity for every successful bid.
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