TreDs

Firms with Rs 250 crore turnover rush to register on TReDS as March 31 deadline nears

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Companies with an annual turnover of ₹250 crore are actively registering on the Trade Receivables Discounting System (TReDS) platform to meet the MSME Ministry’s deadline of March 31, 2025. As per the government’s directive, all enterprises with a turnover exceeding ₹250 crore, along with Central Public Sector Enterprises (CPSEs) that procure goods and services from Micro, Small, and Medium Enterprises (MSMEs), must enroll on the TReDS platform before the deadline.

Government Mandate for TReDS Registration

Currently, it is already mandatory for CPSEs and companies with a turnover of more than ₹500 crore to register on the TReDS platform. However, with the latest notification, the threshold has been lowered to include businesses with an annual turnover above ₹250 crore. This expansion aims to bring more large enterprises into the framework to ensure that MSMEs receive their payments in a timely and efficient manner.

Purpose and Benefits of TReDS

TReDS was introduced by the Reserve Bank of India (RBI) in 2015 as a solution to address delays in payments to MSMEs. The platform has significantly improved payment cycles and provided MSMEs with greater financial stability. Over the years, the system has evolved to facilitate faster settlements on reasonable terms, benefiting small businesses that often face cash flow issues due to late payments from larger buyers.

TReDS operates as a digital marketplace where MSMEs can sell their trade receivables—such as invoices and bills—to banks and financial institutions at a discounted rate. This process helps MSMEs unlock working capital without waiting for long payment cycles from corporate buyers. The participation of large companies and CPSEs ensures that small businesses receive funds in a structured and transparent manner, reducing the financial strain on MSMEs.

Why Large Companies Are Registering on TReDS

With the new regulation in place, large enterprises are now required to comply with the TReDS registration mandate to avoid penalties and regulatory issues. By registering on TReDS, these companies also improve their supplier relationships, as timely payments enhance trust and operational efficiency within the supply chain.

Moreover, businesses that comply with TReDS regulations demonstrate their commitment to supporting the MSME sector, which plays a crucial role in India’s economic growth. The move is also aligned with the government’s broader efforts to enhance ease of doing business and promote financial inclusion for smaller enterprises.

Conclusion

The government’s decision to expand the mandatory TReDS registration to companies with a turnover above ₹250 crore marks a significant step toward strengthening the financial ecosystem for MSMEs. As the March 31, 2025, deadline approaches, large enterprises are swiftly onboarding onto the platform to ensure compliance. By facilitating quicker payments and improving cash flow management for MSMEs, TReDS continues to be a critical tool in promoting a healthier and more transparent business environment in India.

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