Government reduces turnover limit from Rs. 500 crores to Rs. 250 crores for applicability of Trade Receivables Discounting System platform
Companies with turnover more than Rs. 250 crore to comply with Trade Receivables Discounting System platform. This will enable MSME to access credit from banks based on their receivables
The Ministry of Micro, Small and Medium Enterprises has issued Notification No. S.O. 4845(E) dated 07.11.2024 amending the notifications numbers S.O. 5621(E), dated the 2nd November, 2018 and S.O. 5622(E), dated the 2nd November, 2018 to provide that all companies registered under the Companies Act, 2013 (18 of 2013) with a turnover of more than Rs. 250 crore (two hundred and fifty crore rupees) and all Central Public Sector Enterprises shall be required to get themselves onboarded on the Trade Receivables Discounting System platforms (TReDS) set up as per the notification of the Reserve Bank of India.
TReDS is an electronic platform for facilitating the financing / discounting of trade receivables of Micro, Small and Medium Enterprises (MSMEs) through multiple financiers. These receivables can be due from corporates and other buyers, including Government Departments and Public Sector Undertakings (PSUs).
It has been further provided that the onboarding process on the Trade Receivables Discounting System platforms shall be completed by 31.03.2025.
Earlier, Ministry of Micro, Small and Medium Enterprises vide notification SO 5621(E) dated 02.11.2018 had mandated that all companies registered with the Companies Act, 2013 (18 of 2013) with a turnover of more than Rs. 500 crore (rupees five hundred crore) and all Central Public Sector Enterprises shall be required to get themselves onboarded on the Trade Receivables Discounting System platform, set up as per the notification of the Reserve Bank of India.
The Registrar of Companies in each State was authorised to monitor the above compliance by companies under its jurisdiction and the Department of Public Enterprises, Government of India was authorised to monitor the compliance of such instructions by Central Public Sector Enterprises.
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