UPSC Previous Year Question | Prelims GS | 2026

Which of the following statements about M1xchange’s role in Micro, Small & Medium Enterprises (MSMEs) financing is/are correct? 1. M1xchange provides collateral based loans to MSMEs. 2. M1xchange facilitates discounting of invoices and Bills of Exchange for MSMEs. 3. M1xchange functions as a credit rating agency for MSMEs. Select the answer using the code given below:

  1. 1, 2 and 3
  2. 2 only
  3. 2 and 3 only
  4. 1 only

Answer

Correct Answer

2 only

Explanation

M1xchange operates as a Trade Receivables Discounting System (TReDS) platform, facilitating the discounting of invoices and bills of exchange of MSMEs. It is not primarily a provider of collateral-based loans and does not function as a credit-rating agency. Therefore, only statement 2 is correct.

Topics: economy, fintech, invoice discounting, msme finance