| Brief Overview:
New directions on Trade Receivables Discounting System (“TReDS”) are effective.
Technical Details:
1) Customer due diligence (CDD) limited to buyers.
2) An entity regulated by any of the financial sector regulator(s) shall apply for authorisation on the TReDS platform, along with a ‘No Objection Certificate’ from such regulator(s), within 45 days of obtaining the no objection certificate.
3) Minimum net worth requirement is INR 25 Crore as opposed to minimum paid up equity capital.
4) For existing entities authorised to operate TReDS platform need to meet the above-mentioned net worth requirement by 31st March 2028.
5) Removal of restriction on entities other than promoters holding shares in excess of 10%.
6) Permitted financiers can avail credit guarantee cover for exposures undertaken on TReDS.
7) Introduction of new reporting obligations on TReDS entities.
For further details, please see:
Reserve Bank of India (Trade Receivables Discounting System) Directions, 2026
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