Trade Receivables Discounting System (TReDS) & M1xchange

Only statement 2 is correct. M1xchange operates as a licensed Trade Receivables Discounting System (TReDS) platform authorized by the Reserve Bank of India. Its primary function is to facilitate the digital auction and discounting of trade invoices and bills of exchange from MSME suppliers to institutional financiers, improving corporate working capital liquidity without requiring physical collateral (2). Statements 1 and 3 are incorrect because M1xchange operates as an auction marketplace for trade receivables rather than functioning as a direct collateral-backed lender or a licensed credit rating agency.