The Reserve Bank of India on Tuesday granted an inprinciple approval to three companies to set up and operate a new Trade Receivables Discounting System (TReDS) under the Payment and Settlement System (PSS) Act 2007.
A joint venture among the National Stock Exchange’s NSE Strategic Investment Corporation Ltd and Small Industries Development Bank of India, private sector lender Axis Bank and Gurgaon-based Mynd Solutions Pvt Ltd have been granted the clearance. The approval is valid for six months, during which time the applicants have to comply with the requirements under the RBI guidelines. The three firms were selected after a four-part process which included presentations to the RBI’s inter department group and a review of applications by a committee comprising the governor and deputy governors of the central bank.
TReDS will allow small and medium enterprises to post their receivables on the system and get them financed, bringing in much needed transparency to the trade receivable system.
Separately, the RBI also granted an in-principle approval to the National Payments Corporation of India (NPCI) to function as the Bharat Bill Payment Central Unit. Such units facilitate collection of bills and repetitive payments.
This will be an integrated bill payment system, with a single brand image providing convenience of `anytime anywhere’ bill payment to customers. “As the central unit, NPCI will set necessary operational, technical and business standards for the entire system and its participants, and also undertake clearing and settlement activities. The present scope of BBPS will include utility bill payments, such as electricity, water, gas, telephone and DTH.
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