Which of the following statements about M1xchange's role in Micro, Small & Medium Enterprises (MSMEs) financing is/are correct?
- M1xchange provides collateral based loans to MSMEs.
- M1xchange facilitates discounting of invoices and Bills of Exchange for MSMEs.
- M1xchange functions as a credit rating agency for MSMEs.
Select the answer using the code given below:
Correct answer: B
Explanation
M1xchange is one of RBI's licensed TReDS (Trade Receivables Discounting System) platforms. It enables MSMEs to get their invoices and bills of exchange discounted by financiers through competitive bidding, improving working-capital access (statement 2 correct). It does not extend collateral-based loans itself (1 wrong) and is not a credit rating agency (3 wrong); CRAs are licensed separately by SEBI. Hence only statement 2 is correct. Read more: AI-Powered Financial Inclusion in India: How DPI and Analytics Are Rewriting Credit Access.