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Axis Bank, Small Industries Development Bank of India (SIDBI), NSE Strategic Investment Corporation (NSIC) and NSDL Database Management Ltd (NDML) are among the applicants wanting to set up Trade Receivables Discounting System (TReDS).
Trade Receivables Exchange (Group of Banking Professionals), Mumbai, Trade Receivables Exchange (T-REX), Gurgaon-based Mynd Solutions Pvt Ltd and Kolkata-based DICIC Bank of India are the other applicants, as per RBI website.
In December last year, the RBI issued norms to set up of an exchange-based trading platform Trade Receivables Discounting System (TReDS) to facilitate financing of bills raised by micro, small and medium enterprises (MSMEs) to corporate and other buyers, including government departments and PSUs by way of discounting.
It would discount invoices so that final payment of the bill to the MSME is made by buyer on a due date.
MSME sellers, corporate and other buyers, including the government departments and PSUs, and financiers (both banks and NBFCs) will be direct participants in the TReDS, the RBI said.
Highlighting the requirements, the RBI had said the TReDS should have a minimum paid up equity capital of Rs 25 crore and non-promoters would not hold over 10 per cent of the equity capital of TReDS.
"Entities, other than the promoters, will not be permitted to have shareholding in excess of 10 per cent of the equity capital of the TReDS. The overall financial strength of the promoters/entity seeking to set up TReDS would be an important criteria of assessment/selection," the central bank said.
It further said that, “Since the TReDS will not be allowed to assume any credit risk, its minimum paid up equity capital shall be Rs 25 crore. The foreign shareholding in the TReDS would be as per the extant foreign investment policy.”
Among others, the RBI said, TReDS should have sound technological basis to support its operations, be able to provide electronic platform for all the participants and information about bills, discounting and quotes should be in real time supported by a robust information system.
MSMEs, despite the important role played by them in the economic fabric of the country, continue to face constraints in obtaining adequate finance, particularly in terms of their ability to convert their trade receivables into liquid funds.
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