The MSME sector has been adversely affected due to the ongoing Covid-19 pandemic. In continuation of the various interventions (schematic/non-schematic) undertaken by the Small Industrial Development Bank of India – SIDBI towards quick response to the emerging situation, Swavalamban Crisis Responsive Fund (SCRF) is created.
The captioned fund will enables MSME suppliers to get quick access to low-cost finance through
Quicker Payments : MSME sellers receive funds against approved invoices within 48 hours
Multiple Financiers: MSMEs are not restricted to a single bank. Have the option to choose the lowest bids among the multiple financiers
Without Recourse Borrowing: No obligation on the seller to repay the financier. The buyer’s account in debited automatically through a pre-approved NACH mandate.
Lower Cost of Funds: Transparent bidding process to discover the most suitable price. Seller can access financing at competitive terms as it is based on the credit rating of the buyer.
To avail all above facilities, registration on Trade Receivables Discounting System (TReDS) Platform. Earlier the fee to onboard was kept 10,000 but now SIDBI is supporting for FREE onboarding of the MSMEs on the TReDS Platform. The fund waives off MSMEs joining / registration fees such that they derive benefits on the TReDS Platform.
About TReDS: TReDS is an institutional mechanism set up in order to facilitate the trade receivable financing of MSMEs from corporate buyers through multiple financiers. To address the financing related issues faced by MSMEs in India, RBI in 2014 introduced the concept of TReDS, a mechanism of trade receivables financing for MSMEs on a secure digital platform. It is an answer to the cash flow issues of the MSMEs in India and effective solution to enable MSME5 to take the next growth leap & reap emerging opportunities.
TReDS Companies : Receivables Exchange of India Ltd (RXIL), Mlxchange, Invoicemart
Target: 10,000+ MSMEs
Time frame: Upto March 31, 2021
Where to onboard : www.invoicemart.com, www.mlxchange.com, www.rxil.in
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