Lok Sabha Question No. 572 (UNSTARRED), answered on 2025-02-06
Subject: Invoice Management System
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri K C Venugopal

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION NO. 572 TO BE ANSWERED ON 06.02.2025

## INVOICE MANAGEMENT SYSTEM

## 572. SHRI K C VENUGOPAL:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) the  manner  in  which  the  Ministry  of  MSME  is  collaborating  with  the  Ministry  of  Finance  to address  the  technological  and  operational  challenges  faced  by  MSME  retailers  in  implementing  the Invoice Management System (IMS);
- (b) whether the Ministry proposed an extension or phased rollout of IMS to the Ministry of Finance to ensure sufficient transition time for small businesses;
- (c) the  steps  being  taken,  in  coordination  with  the  Ministry  of  Finance  to  ensure  timely  release  of APIs  and  provide  user-friendly  tools,  such  as  bulk-upload  facilities,  to  support  MSMEs  with  high transaction volumes;
- (d) the  steps  taken/being  taken  by  the  Ministry  to  address  the  tight  timelines  for  resolving  invoice discrepancies  including  raising  these  concerns  with  the  Ministry  of  Finance  to  prevent  cash  flow disruptions for small businesses; and
- (e) the  measures  being  proposed  by  the  Ministry  to  reduce  the  initial  investment  burden  on  small businesses for upgrading systems to comply with IMS?

## ANSWER

## MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES (SUSHRI SHOBHA KARANDLAJE)

(a) to (e): The Ministry of Micro, Small and Medium Enterprises (MSME) presently has no active collaboration with Ministry of Finance (MoF) on Invoice Management System (IMS) implementation. However, we are working alongside MoF on Udyam Registration and Trade Receivables electronic Discounting System (TReDS) platform.

MSMEs can register on Udyam Portal by filling their PAN. The data of Investment and Turnover against that PAN either gets auto filled/ fetched from the Income Tax Department (for those enterprises which have filed IT Returns) or is filed on a self-declaration basis (by those enterprises which are yet to file the IT Returns). From the Turnover data, the export data as searched and found from the GSTN data, against that PAN, is deducted. While there is an API to fetch data from the Income Tax Department on a real time basis, GSTN data is fetched from the annual dump provided by GSTN.

TReDS, an electronic platform, facilitates the discounting of trade receivables of MSMEs through multiple financiers. Recently, to unlock their working capital by converting their trade receivables into cash,  based  on  the  suggestions  of  stakeholders  including  associations,  Government  of  India  through notification dated 07.11.2024 has notified the reduction of the turnover threshold of buyers for mandatory onboarding on the TReDS platform from Rs. 500 crores to Rs. 250 crores.

The  Ministry  of  MSME  is  taking  proactive  steps  to  address  the  tight  timelines  for  resolving invoice discrepancies. The Ministry is promoting the use of the MSME Samadhaan portal to facilitate the timely resolution of payment disputes.

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