Lok Sabha Question No. 1698 (UNSTARRED), answered on 2017-03-10
Subject: Establishment of TReDS
Ministry: FINANCE
Asked by: RAJESH RANJAN  (PAPPU  YADAV), RANJEET RANJAN

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA

## UN-STARRED QUESTION NO. 1698

## TO BE ANSWERED ON 10 th  March, 2017 / PHALGUNA 19, 1938 (SAKA)

## 'ESTABLISHMENT OF TReDS'

1698 : SHRI RAJESH RANJAN:

SMT. RANJEET RANJAN :

Will the Minister of FINANCE be pleased to state :

- (a) whether the RBI have given license to banks and accounting solution firms to establish and operationalise Trade Receivable Discounting Systems (TReDS) and if so, the details thereof ;
- (b) whether the Government has taken steps for expediting the establishment of TReDS  in  view  of  the  dependence  of  MSME  sector  on  informal  sources leading to losses on account of demonetisation and if so, the details thereof ;
- (c) whether  Government  has  agreed  to  the  recommendation  of  Federation  of Indian MSMEs (FISME) to extend legislative backing to TReDS so that status of  deemed acceptance is granted to the uploaded invoices to convert them into negotiable financial instruments mandatorily; and
- (d) if so, the details thereof ?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)

## (a) & (b) :

Reserve Bank of India (RBI) has given licence to Receivables Exchange of India Limited (RXIL), jointly promoted by NSE Strategic Investment Corporation  Ltd.  (NSICL)  and  Small  Industries  Development  Bank  of  India (SIDBI)  out  of  three  entities  which  were  granted  in-principle'  approval  for setting  up  and  operationalisation  of  Trade  Receivable  Discounting  Systems (TReDS).  RXIL has started operations on January 09, 2017.

- (c) and (d) :  No, Madam.

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## LOK SABHA UN-STARRED QUESTION NO. 1698 TO BE ANSWERED ON 10 th  March, 2017 / PHALGUNA 19, 1938 (SAKA)

## 'ESTABLISHMENT OF TReDS'

| QUESTION 1698 : SHRI RAJESH RANJAN: SMT. RANJEET RANJAN : Will the Minister of FINANCE be pleased to state :                                                                                                                                                                        | ANSWER MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)                                                                                                                                                                                                                                                                                                                                                                   |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| (a) whether the RBI have given license to banks and accounting solution firms to establish and operationalise Trade Receivable Discounting Systems (TReDS) and if so, the details thereof ;                                                                                         | (a) and (b) : Reserve Bank of India (RBI) has given licence to Receivables Exchange of India Limited (RXIL), jointly promoted by NSE Strategic Investment Corporation Ltd. (NSICL) and Small Industries Development Bank of India (SIDBI) out of three entities which were granted in- principle' approval for setting up and operationalisation of Trade Receivable Discounting Systems (TReDS). RXIL has started operations on January 09, 2017. |
| (b) whether the Government has taken steps for expediting the establishment of TReDS in view of the dependence of MSME sector on informal sources leading to losses on account of demonetisation and if so, the details thereof ;                                                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| (c) whether Government has agreed to the recommendation of Federation of Indian MSMEs (FISME) to extend legislative backing to TReDS so that status of deemed acceptance is granted to the uploaded invoices to convert them into negotiable financial instruments mandatorily; and | (c) and (d) : No, Madam.                                                                                                                                                                                                                                                                                                                                                                                                                           |
| (d) if so, the details thereof ?                                                                                                                                                                                                                                                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

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