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: Factoring Regulation (Amendment) Bill is a welcome move by govt: CEO, RXIL #finance #StockMarketNEWS Factoring Regulation (Amendment) Bill is a welcome move by govt: CEO, RXIL New Delhi, Jul 27 (KNN) The

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Factoring Regulation (Amendment) Bill is a welcome move by govt: CEO, RXIL #finance #StockMarketNEWS
Factoring Regulation (Amendment) Bill is a welcome move by govt: CEO, RXIL New Delhi, Jul 27 (KNN) The Factoring Regulation (Amendment) Bill is a welcome move by the government which will now enable NBFCs other than the seven RBI-licensed NBFC factors previously allowed, said Ketan Gaikwad, MD & CEO, Receivables Exchange Of India (RXIL).

The Factoring Regulation (Amendment) Bill, which was tabled in Parliament last year, was passed on Monday. The bill seeks to liberalize the participation of non-banking financial companies (NBFCs) in the factoring business. It also removes the requirement of an entity in this business called factor to report every transaction within 30 days. The bill proposes that such finer details will be specified in regulations.

This increased competition in the factoring business has increased the potential usage and adoption by MSMEs of the country and helped them have access to formal sources of credit on TReDS. In recent years, digital lending has been able to service the problem areas of the MSME ecosystem fairly efficiently, Gaikwad said in a statement on Monday.

He further said that the TReDS platform specifically provides recourse free, trusted receivables payments to MSMEs within 48 hours which has helped smoothen their working capital cycle.

An increase in invoice discounting volume on the platform mirrors a higher speed of financing and revival for MSMEs, he added.

According to him, the bill also empowers RBI to make regulations regarding the manner of filing of transaction details with the Central Registry for transactions done through the TReDS that is a huge plus point.


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