RBI Deputy Governor on Digital Tools for MSME Credit Flow
Why in the news
The RBI Deputy Governor spoke on how technology can ease credit hurdles for small firms.
Tools
| Tool | Role |
|---|---|
| TReDS | Lets MSMEs discount trade receivables; improves liquidity |
| ULI | Pools borrower information for cash-flow lending |
| Account Aggregator | Consent-based sharing of financial data |
| Regulatory sandbox | Supervised testing of fintech ideas |
Other steps
- MSME associations to bridge information gaps; more credit guarantee use; revival of viable distressed units.
Exam angle
- TReDS = Trade Receivables Discounting System; 30th SAC.