Sidbi Sets Up Fund to Facilitate Free Onboarding of MSMEs on TReDS Platform
- Small Industries Development Bank of India (Sidbi) on Friday said it has set up a fund to support free onboarding for micro, small and medium enterprises (MSMEs) on trade receivables discounting system (TReDS).
- The free onboarding of MSMEs would be available till September-end, according to a release.
- The fund, Swavalamban Crisis Responsive Fund, is an open-ended fund and the target is to onboard 10,000 MSMEs during the period, a Sidbi spokesperson said.
- “The present endeavour aims at offering relief to the MSMEs during these challenging times. We are hopeful that MSMEs shall maximise this opportunity to on board TReDS, thus getting much-needed breather from severely crunched cash flow,” Sidbi Chairman and Managing Director Mohammad Mustafa said.
- Usually, an MSME has to pay a fee of Rs 5,000 to Rs 10,000 for getting registered on a TReDS platform.
- The fund would be utilised to offset the cost of joining/registration fee on the TReDS platform, Sidbi said.
- Three TReDS platforms — Receivables Exchange of India Ltd (RXIL), M1xchange and Invoicemart — will help MSMEs gain access to working capital through invoice discounting via multiple financiers.
- TReDS is an electronic platform where receivables of MSMEs drawn against buyers, including large corporates, public sector undertakings and government departments, are financed through multiple financiers at competitive rates through an auction mechanism.
Small industrial Development Bank of India (SIDBI) is a development financial institution in India, headquartered at Lucknow and having its offices all over the country. Its purpose is to provide refinance facilities and short term lending to industries, and serves as the principal financial institution in the Micro, Small and Medium Enterprises (MSME) sector. SIDBI also coordinates the functions of institutions engaged in similar activities. It was established on April 2, 1990, through an Act of Parliament. It is headquartered in Lucknow.SIDBI operates under the Department of Financial Services, Government of India.
- Founded – 2 April 1990
- Headquarters – Lucknow, Uttar Pradesh
- Chairman & Managing Director (CMD)– Mohammad Mustafa
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