New Delhi, June 24 -- The Reserve Bank of India (RBI) has issued comprehensive new directions governing the Trade Receivables Discounting System (TReDS), consolidating a decade of fragmented guidelines into a single regulatory framework.

The directions come into effect immediately and repeal the original TReDS guidelines issued in December 2014 along with subsequent circulars.

TReDS is an electronic platform that facilitates the financing of trade receivables of micro, small and medium enterprise (MSME) sellers through multiple financiers, helping businesses convert unpaid invoices into liquid funds.

The RBI in a release said that MSMEs continue to face constraints in obtaining adequate finance, particularly in this area, and the revis...