RBI to launch first trade exchange platform

Reserve Bank of India has authorised Receivables Exchange of India Limited (RXIL) to launch India’s first trade receivables exchange platform – an online marketplace for MSMEs, Buyers and Financiers. SBI, ICICI Bank, YES Bank, SBI Capital Markets Ltd., and ICIC Securities, are the other joint investors.

The Trade Receivables Discounting Systems (TReDS), an automated system is driven platform is expected to benefit MSMEs by facilitating them to auction their trade receivables at competitive market rates through a transparent bidding process on the platform by multiple financiers.

Dr. Kshatrapati Shivaji (IAS), Chairman and Managing Director, SIDBI said that this major initiative is the continuum of series of SIDBI’s efforts in addressing the gaps in the MSME ecosystem.He also reiterated that SIDBI way back in the early nineties piloted the Receivable Financing Scheme [RFS] in reverse factoring process in India for addressing the delayed payments problem of MSMEs. SIDBI through the Scheme has demonstrated how credit profile of large corporates could be leveraged for bringing down the cost of financing of receivables of MSMEs with more than 23000 registered MSME beneficiaries.

While SIDBI brought in its expertise spanning two decades on the subject for MSME finance and factoring operations, NSE came in with its technical expertise in managing exchange operations to commence the TReDS platform successfully.