Can Digital Platforms Solve MSMEs' Delayed Payment Crisis? Assessing TReDS and MSME Samadhaan in India

Abstract: Micro Small and Medium Enterprise (MSME’s) receivable delayed payments serve as a major problem which adversely affects liquidity and working capital (Khardenavis, 2024). To address these problem, the government of India introduced online portal “Trade Receivables Discounting System (TReDS) and MSME Samadhaan”. However, their operational effectiveness, dispute resolution efficiency, and impact on MSME financial health remain understudied. This research is being carried out to study the effectiveness of those online portals in addressing these challenges. Based on a purposive sample of 94 MSMEs supplying goods and services to government organisation in India, the study uses primary data collected via structured questionnaires and secondary data from RBI reports. To assess the impact of TReDS usage on financial performance, correlation and simple linear regression analyses were conducted. Findings show that TReDS significantly enhances liquidity, shortens receivables cycles and improves working capital efficiency, however its effect on profitability is comparatively modest. MSME Samadhaan portal on the other hand is found to be ineffective where only 22% case was resolved. The main reason is due to procedural delays and low participation from micro-enterprises.

Keywords: TREDS, MSME Samadhan, Delayed Payment, Factoring