Samunnati said Wednesday it has onboarded its first farmer producer organisation (FPO) on TReDS and completed a transaction of discounting invoices worth ₹3.5 crore through Invoicemart on the platform. TReDS is an electronic platform that facilitates the financing and discounting of trade receivables of micro, small and medium enterprises (MSMEs) through multiple financiers.

While TReDS is popular among MSMEs, this is the first time an FPO has significantly benefited from invoice discounting in the context of FPO financing.

The FPO is a pioneering farmer collective from Tamil Nadu and has been associated with Samunnati for more than five years. Samunnati provides the FPO customised financial solutions, training and capability building, and market linkage, the company said in a statement.

Its primary utility is to resolve one of the most critical issues for small businesses, namely managing cashflows for business continuity. RBI’s efforts to strengthen TReDS and encourage digital financing for small businesses will benefit FPOs in India by reducing the burden of working capital through invoice financing. The platform allows for receivables that are due from corporates, government departments, public sector undertakings (PSUs), and other buyers to be discounted, Samunnati said.

Samunnati, a registered buyer on TReDS since September 2020, is one of the most active participants on the platform, onboarding more than 75 new suppliers, mainly MSMEs, to date and increasing its banking limits over the years towards priority sector lending. In 2021-22, Samunnati onboarded over 30 new suppliers and facilitated transactions worth ₹100 crore through TReDS.

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Samunnati is one of the first players in the agri sector to discount such a substantial amount through TReDS.

Anil Kumar SG, Founder and CEO, Samunnati, said, “We are extremely pleased and proud to onboard one of our most valued FPO partners on TReDS and it is evident that FPOs can also benefit from TReDS like MSMEs. This is just the beginning and there exists a huge opportunity to be tapped. It also serves as an inspiration that needs to be replicated among other FPOs across India. This move assumes great importance in the context of enhancing FPOs’ access to finance, particularly to customised solutions tailor-made to their specific needs, ensuring business continuity and uninterrupted operations.”

Prakash Sankaran, MD and CEO of Invoicemart,said “Invoicemart is happy to collaborate with Samunnati to bring an early payment solution to FPOs who are MSMEs. The open agri network of Samunnati and the cutting-edge financial solutions of Invoicemart will help unlock value in the agri ecosystem.”

Through TReDS, FPOs can leverage their trade receivables to manage their cashflows better, strengthen and expand their operations by means of the trade opportunities. Onboarding of an FPO on TReDS not only enhances its access to finance, but also captures the digital footprint of its financial transactions, which will be helpful for the ongoing digitalisation drive towards bringing greater efficiency, transparency, and trust in the FPO ecosystem.

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