Press Release

M1xchange Surpasses INR 1,00,000 Crore in Invoice Discounting Throughput

M1xchange, India’s leading invoice discounting platform has reached a significant milestone by surpassing ₹1,00,000 crore in throughput value. This highlights the platform’s crucial role in transforming the landscape of alternative financing for small businesses across the country.

M1xhange, India’s leading TReDS (trade receivables discounting system) platform is the first to successfully expand the scope of TReDS through Small-to-Small (S2S) financing. This initiative effectively bridges the credit gap and integrates tier 2 and tier 3 MSMEs into the formal credit ecosystem, significantly contributing to their growth and sustainability. S2S financing has broadened the scope of TReDS platform, enabling more banks and NBFCs to engage with underserved MSMEs, which fosters economic development at a grassroots level.

Invoice discounting via TReDS experienced a significant upsurge in 2023 driven by adoption among MSMEs, corporates, and banks. Sundeep Mohindru, Promoter & Director, M1xchange, said, “From the very beginning, our vision was to transform access to working capital through digitization and innovation. This milestone is significant, but it merely scratches the surface of the vast opportunities ahead. By facilitating credit through competitive interest rates, prompt disbursals, and streamlined processes, we are creating immense opportunities to boost MSME growth in India.”

According to an EY report, the MSME sector in India has a staggering credit gap of $530 billion.  Among the 64 million MSMEs in the country, only about 14% have access to formal credit. M1xchange aims to bridge this gap by reducing financing costs for both corporate buyers and MSME sellers.

Showcasing a consistent 100% year-on-year growth, M1xchange discounted invoices worth INR 43,000 crores in FY24 compared to INR 23,100 crores in the previous fiscal. This impressive growth in transaction volume is attributed to the increasing acceptance and understanding of TReDS among businesses. The platform has witnessed 100% month-on-month increase in registrations from corporates and MSMEs alike, recognizing the efficiency and cost-effectiveness of TReDS. Additionally, M1xchange has also signed up MOU with numerous state governments, including Maharashtra Haryana, Goa, Madhya Pradesh and Tamil Nadu to offer liquidity to the state’s MSMEs while ensuring timely payments at a competitive rate.

TReDS also benefits financiers on the platform with timely repayments and negligible defaults. Banks now have opened credit sanctions to BBB-rated corporates, benefiting MSME sellers of these corporates by enabling them to realize their payments digitally in advance. Further the cost of financing on TReDS is reduced by 5-8%, significantly lowering the business expenses for MSMEs. These savings are passed on to corporate customers, incentivizing both parties to adopt TReDS.

 

About M1xchange

M1xchange is a TReDS (Trade Receivables Discounting) exchange that started in April 2017. M1xchange facilitates the financing of trade receivables of MSMEs from corporate buyers through ‘factoring’ or ‘invoice discounting’ by financiers (Banks and NBFC). In a short span of time, M1xchange has onboarded 60+ Banks, 1,600+ corporates, and 32,000+ MSMEs and has facilitated discounting of invoices of more than Rs 100,000 Crores. Transactions on the TReDS platform happen digitally and start when the MSME Supplier of Goods & Services raises the invoice, and the Buyer validates the same. This permits the financiers (Banks/ NBFCs) to bid against the verified and approved invoice. Once the supplier accepts the bid, the payment is processed in 24 hrs. and credited to the MSMEs bank account. Through this platform, M1xchange promises MSMEs greater access to finance” at competitive rates and without providing any collateral. Further, the financing is without recourse. MSMEs pass on the risk of receivables to the financiers (NBFCs/Banks) by selling their receivables.