MSMEs | Delayed payments continue to clog liquidity. TReDS could be the answer
With increased penetration of ‘digital’ and the promising rise of ‘Fintech’, TReDS, which is an online solution based on ‘incentives’, certainly promises to be a scalable and sustainable one, if not exactly a panacea
The COVID-19 second wave has hit India hard, destroying lives and livelihoods. In these stressed times, the Reserve Bank of India (RBI) Governor made an unscheduled address on May 5, announcing relief measures for MSMEs. While the RBI and the government have been proactive in extending several support schemes, it is important to focus on the unresolved, underlying issues that have led to financial stress even in normal times, particularly for micro and small businesses.
The Expert Committee on Micro, Small and Medium Enterprises, headed by UK Sinha, in 2019 examined several such fundamental issues, one of which was of delayed payments, referred to in the report as a “perennial problem”.