All operating Central Public Sector Enterprises will now have to route settlement of invoices for goods and services procured from MSMEs through Trade Receivables Discounting System platforms authorised by the Reserve Bank of India.
The requirement has been introduced through a notification issued by the Ministry of Micro, Small and Medium Enterprises on 30 June, giving effect to a Union Budget 2026-27 announcement.
The mandate applies to MSME invoices raised against CPSE procurement of goods and services.
Under the notification, CPSEs will also have to disclose details of MSME invoices routed and settled through TReDS in the manner specified by the RBI.
They will be required to obtain a statutory auditor’s certificate on TReDS registration and compliance during their annual audit.
The change is aimed at addressing delayed payments to MSME suppliers, a long-running issue that affects working capital for smaller businesses.
According to the ministry, more than 8.70 crore enterprises are registered on the Udyam Registration Portal and Udyam Assist Platform, providing employment to more than 38 crore people.
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With CPSE invoices moving through TReDS, MSME suppliers will be able to discount approved invoices before the due date.
The platform allows banks and non-banking financial companies to bid for discounting invoices, giving MSMEs access to working capital against receivables.
The ministry said financing on TReDS is collateral-free and without recourse to the seller.
TReDS is an RBI-regulated electronic platform that has been operational since 2017.
It is used for financing and discounting trade receivables of MSMEs due from corporate buyers, government departments and public sector undertakings.
Five platforms are currently operational: RXIL, M1xchange, Invoicemart, C2treds and DTX.
Invoice discounting through TReDS has risen from ₹40,000 crore in FY 2021-22 to ₹3.47 lakh crore in FY 2025-26.
TReDS went live in 2017. In November 2018, companies with turnover above ₹500 crore and all CPSEs were mandated to onboard on the platform.
In November 2024, the threshold was reduced to ₹250 crore.
The 30 June notification goes a step further by requiring all operating CPSEs to route settlement of MSME invoices through TReDS.
The requirement is expected to make invoice settlement more trackable and bring CPSE payment practices under a formal compliance framework.
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