M1xchange eyes Rs. 30,000-cr business in FY23 – The Hindu BusinessLine

Clipped from: https://www.thehindubusinessline.com/todays-paper/tp-news/m1xchange-eyes-rs-30000-cr-business-in-fy23/article65091230.ece

Sundeep Mohindru, CEO, Mynd Solutions

First invoice-basedtrade credit cover transaction likelyin April, says CEO

M1xchange, a digital invoice discounting platform for Micro, Small and Medium Enterprises (MSMEs), is eyeing business of Rs. 30,000 crore in 2022-23, riding on the dramatic scaling up of the TReDS platform in the country in the last two years.

This is more than double the volume of Rs. 13,000 crore that the Trade Receivables Discounting System (TReDS) platform expects to clock this fiscal,Chief Executive Officer (CEO), Mynd Solutions, Sundeep Mohindru, told BusinessLine here.

In fiscal 2020-21, M1xchange recorded a business volume of about Rs. 5,700 crore. Its decision to introduce a mobile app has accelerated the adoption among MSMEs, with transactions now being put through from over 900 cities across the country.

“We have further accelerated this upswing — in addition to the ecosystem development — by launching a mobile app. Every MSME on our portal now uses this app. This is one big change we have brought about in the last two years. About 40 per cent of our business volumes come through the mobile app,” he said.

Mohindru attributed the upswing in business volume to the benefits that all three participants — MSMEs, large corporates and banks — have derived from TReDS.

The confidence of banks has gone up and every bank now wants to participate in the TReDS platform because there is minimum default even in a corona environment, he noted.

Set up by Mynd Solutions in April 2017, M1xchange is among the three Trade Receivable Discounting Systems (TReDS) platforms — online marketplaces — approved by the RBI to bring together buyers, sellers and financiers for discounting MSME invoices.

NBFCs’ entry

For the next fiscal, Mohindru expects business volumes to scale up further now that the government and RBI have allowed NBFCs to do funding via the TReDS platform. Prior to the amendment in the Factoring Act in September 2021, only banks were allowed to come on TReDS.

Mohindru said that the IRDAI-approved trade credit insurance facility is expected to go live on the M1xchange platform in April this year. Currently, trade credit insurance is running on a whole turnover basis. “We have already done our integration with this insurance company (Tata AIG General Insurance). We expect to do the first transaction in April,” he said.