About TReDS
TReDS is an online platform set up to facilitate MSMEs to overcome working capital challenges by converting their receivables into cash.
It empowers discounting of invoices through an auction mechanism to ensure prompt realisation of trade Receivables.
Benefits to Sellers
- Competitive price.
- Without recourse to Seller.
- Can choose the best bid and financiers.
- Faster payment.
- No follow with the buyer for payment.
- Enhanced productivity and efficient working capital / liquidity management.
Benefits to Buyers
- Compliant with MSMED Act, 2006.
- Better negotiation / transparency.
- Lower cost of inputs.
- Enhanced productivity and efficient working capital / liquidity management.
- Better administration.
General Benefits
- Automated and transparent platform.
- Paperless and easy.
- Cost effective.
Checklist of documents
- Online application form.
- Letter of Authorisation / Board Resolution / Declaration.
- Master agreement and general terms and conditions.
- PAN copy of the company.
- Address proof of the company – Utility bill copy.
- Certificate of Incorporation.
- Udyam Registration certificate.
- MOA and AOA.
- Latest two years annual report, financials along with ITRs.
- Shareholding pattern.
- GST registration certificate.
- Bank mandate.
- Cancelled cheque copy.
- ID proof and signature verification of the authorised signatory.
- Address proof of the authorised signatory – Aadhaar copy.
Applicable / relevant act / rules
The Companies Act, 2013, The Micro, Small and Medium Enterprises Development Act, 2006 and Reserve Bank of India, etc.
Applicability
All companies registered under the Companies Act, 2013 (18 of 2013) with a turnover of more than INR.250.00 crores (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, set up as per the notification of the Reserve Bank of India.
Due date
The onboarding process on the Trade Receivables Discounting System platforms shall be completed by 31st March, 2025.
Please do refer to the enclosed notification dated 7th November 2024.
Courtesy: Team TReDS.
Disclaimer
This document has been issued in the general interest of knowledge transfer purpose and it cannot be construed in any other manner whatsoever.
Thank you for your time.
Ganashri Advisers India LLP | +91 94801 18310 | +91 83106 26652 |