Turn bills into profits with Invoice Discounting

What is Bill Discounting?

In bill discounting, the business discount the outstanding invoices to gain access to short-term financial assistance and maintain the working capital. This process is also called “Invoice Discounting”. This process is governed by the negotiable instrument act, 2010. Factoring & Reverse Factoring are two methods a bill is discounted on TReDS platorm. Both the methods are designed to speed up and increase cash flow without disturbing the balance sheet.

Factoring involves a financial transaction where a business sells its accounts receivable (invoices) to a Financier at a discount. The benefits of factoring include working capital optimization, credit protection against bad debts, no collateral required, and prompt payments for your invoices.

On the other hand, reverse factoring (also known as supply chain financing) is a process where a buyer company collaborates with a financial institution (such as a bank or NBFC) to provide early payment to its suppliers. This approach leads to improved cash flow for suppliers, minimizes the need for costly payment requests, secures financing at competitive interest rates, and fosters stronger, long-term relationships between buyers and suppliers.

MSME Cash Flow Challenges

Solved by TReDS Bill Discounting

Bill Discounting by M1xchange is a process guided by RBI to regulate the trade receivables between Corporates, MSMEs and Financiers. Watch the complete video to understand how bill discounting works for all the stakeholders on the TReDS platform.

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Discounting bills provide businesses funds upfront rather than waiting for 30-120 days. The completion of multiple business cycles further helps in improved cash flows and increases revenue rather than limiting operations due to a lack of funds.

Improved Cashflow

Instant cash payment

No collateral required

Competetive Interest Rate

Features of Bill Discounting

Bill discounting can be a great way to help manage cash flow and get ahead on bills, but there are some essential features to look out for when choosing a bill discounting service. Here are some of the most important ones:

Advantages of Bill Discounting

Bill discounting is advantageous to businesses, banks, finance companies, and investors. Businesses benefit by rejuvenating their cash-flow in-turn helping them stabilize growth and fund business expenditure.

Cash flow

Businesses being dependent on the cash flow to sustain their business can easily rely on this quick financial aid to access speedy funds and continue to flourish. This process quickens money inflow— profiting the organization in expanding deals, seeking after development, securing hardware, etc.

Instant access to cash

Bill discounting is a more efficient, faster way of assessing working capital as it is hassle-free and does not involve the lengthy documentation procedure. With M1xchange, businesses can secure financial assistance within 24 hours.

No collateral involved on TReDS

here is no requirement to keep any asset as security as the unpaid invoice is considered as the collateral itself.

No debt incurred

Bill discounting helps in saving tax liability. The chances of a company suffering any loss or damage are almost nonexistent when compared to conventional financing frameworks.

No impact on the balance sheet

Bill discounting service offered by M1xchange does not impact the balance sheet of the business as it is an off-the-book process.

Bill Discounting Explained

Bill Discounting by M1xchange is a process guided by RBI to regulate the trade receivables between Corporates, MSMEs and Financiers. Watch the complete video to understand how bill discounting works for all the stakeholders on the TReDS platform.

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Bill Discounting Explained

Bill Discounting by M1xchange is a process guided by RBI to regulate the trade receivables between Corporates, MSMEs and Financiers. Watch the complete video to understand how bill discounting works for all the stakeholders on the TReDS platform.

RBI Licensed TReDS Platform Play Video

Bill Discounting Explained

Bill Discounting by M1xchange is a process guided by RBI to regulate the trade receivables between Corporates, MSMEs and Financiers. Watch the complete video to understand how bill discounting works for all the stakeholders on the TReDS platform.

Bill Discounting Explained

Bill Discounting by M1xchange is a process guided by RBI to regulate the trade receivables between Corporates, MSMEs and Financiers. Watch the complete video to understand how bill discounting works for all the stakeholders on the TReDS platform.

Bill Discounting

Business loan

Frequently Asked Questions

TReDS is a digital marketplace set up by RBI in order to facilitate the discounting of invoices for MSMEs from corporate buyers through multiple financiers. There are several platforms for bill discounting platforms. M1xchange is one of the leading invoice discounting platforms in India.

Yes, it is eligible for tax benefits as it does not deduct tax at source.

In bill purchasing the whole amount is credited to the individual’s account by the finance institute after the purchase, the seller receives the whole amount of the bill as opposed to invoice/bill discounting, and the bank gets the commission.

Factoring & Reverse Factoring and two methods a bill is discounted on the TReDS platform. Both methods are designed to speed up and increase cash flow without disturbing the balance sheet.

Yes, bill discounting is an excellent option for your business as long as you exercise strong credit control procedures and maintain low debts.

Bill Discounting isn't technically a loan. It's a financing option where you sell outstanding invoices to a financial institution at a discounted rate to receive immediate funds. You don't repay the amount, but instead, repay the invoice value when your customer settles it.

Get started with hassle-free bill discounting on M1xchange, India's premier TReDS platform

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