Tradeindia Exim Newsletter
26, November 2019
CEO's Note
Delayed payments

Late payment is an old parasitic business practice. While extending credit to customers is an aid to selling, there is also an inevitable element of risk involved, and when it comes to Micro, Small and Medium Enterprises (MSMEs), their cash flow can hardly withstand the burden of late payment. But late payment has become a way of doing business. Time and again, the government has come forward with steps to rescue our MSMEs from being hamstrung by undue delayed payments, but a real solution still seems far off.

The Union Minister of State for Finance recently said that several measures are being taken in this direction. The SAMADHAAN portal, for example, has been launched to help MSEs directly register their cases online relating to delayed payments by Central Ministries/ Departments/ Central Public Sector Enterprises (CPSEs)/ State Governments, etc. According to data being displayed on the portal, till now 29,999 applications have been filed by MSEs, against which only 1,819 cases have been disposed. This data is not that encouraging.

Similarly, the RBI introduced an online platform, TReDS, in March 2014 to facilitate discounting of bills and invoices of MSE suppliers. Following this, Receivables Exchange of India Ltd (RXIL), the first TReDS platform, was incorporated in 2016. However, the process, which involves three parties--MSE suppliers, corporate buyers and financiers-- with the financier requiring to discount the invoice after the corporate buyer accepts the invoice and bills uploaded by the MSME supplier, is too cumbersome.

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am happy to say that we are just going to be a part of and hope we will always become more satisfied at here.

Mr. H N Tailor - Proprietor
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