Mandatory TReDS onboarding for Corporates with turnover of 250cr or more
                     Mandatory TReDS onboarding for Corporates 
with turnover of 250cr or more
In a significant move to bolster the financial health of Micro, 
Small, and Medium Enterprises (MSMEs), the Ministry of 
MSME has recently issued a notification mandating 
businesses with 250cr+ turnover to onboard the 
Trade Receivables Discounting System (TReDS) platform. This 
directive, effective from November 7th, 2024, is a testament 
to the government’s commitment to enhancing the liquidity 
of MSMEs and streamlining the payment cycle.
What is TReDS?
TReDS is an electronic platform that facilitates the 
discounting of trade receivables. It connects MSMEs 
with financial institutions, enabling them to sell their 
unpaid invoices at a discount and receive immediate 
funds. This mechanism significantly reduces the 
payment cycle, freeing up working capital for MSMEs, 
and fostering their growth and development.
Why is TReDS important?
● Faster Payments: TReDS accelerates the payment cycle, 
ensuring that MSMEs receive timely payments for their goods 
and services.
● Improved Cash Flow: By receiving funds upfront, MSMEs 
can optimise their cash flow, invest in growth initiatives, and 
meet their operational expenses.
● Reduced Financial Risk: TReDS mitigates the risk of delayed 
payments, safeguarding MSMEs from potential financial 
distress.
● Enhanced Transparency: The platform offers a transparent 
and efficient process, providing visibility into the discounting 
process and ensuring fair pricing.
The new mandate: A game changer
The latest government notification mandates that all companies 
registered under the Companies Act, 2013, with a turnover 
exceeding ₹250 crore, must onboard the TReDS platform. This 
expansion of the TReDS mandate is a crucial step towards 
creating a more inclusive and efficient financial ecosystem 
for MSMEs
Key benefits for Corporates
Extended Payment Cycles
The payment cycle decided during the contracts is usually limited 
to 45 days. But with the reverse-factoring feature on TReDS, 
corporates can extend their payment cycle period through a 
financer, while ensuring that the vendor gets paid on time. This 
helps corporates maintain a healthy vendor relationship with the 
relief of the payment cycle.
Improved Working Capital
The discounting feature also helps corporates put the 
working capital to use based on priority. Whether the 
vendor opts for discounting or the corporate opts for 
reverse discounting, the payment time extension enables 
better management of working capital.
Better Negotiations
As a buyer, negotiation plays an important role in improving the 
business’ financial health. When vendors get the confidence of 
assured timely payments through a single platform with a 
reduced payment cycle, the vendors will automatically be quite 
happy to supply their goods & services for the buyer 
organization, and give it preference in delivery timing, and even 
be able to handle larger order sizes. All of this creates a better 
negotiation scenario for the corporates as a buyer.
M1xchange: Your trusted TReDS partner
As a leading TReDS platform, M1xchange offers a 
seamless and efficient bill discounting. Our dedicated team 
is committed to assisting corporates in navigating 
the TReDS ecosystem and maximising its benefits.
Time to take action
As the deadline for onboarding to TReDS approaches on March 31st, 
2025, corporates with a turnover exceeding ₹250 crore must prioritise 
this task. Embracing TReDS is not just a regulatory requirement, but a 
strategic move that can benefit corporates in numerous ways. By 
optimising cash flow, improving supplier relationships, and enhancing 
corporate image, corporates can unlock significant value. M1xchange, 
with its proven track record and commitment to excellence, is well-
positioned to help corporates navigate the TReDS landscape and 
achieve their financial goals.
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