RBI Moves To Open Up TReDS Platform With Interoperability Push To Prevent Market Concentration

The Reserve Bank of India (RBI) is working to introduce interoperability across the Trade Receivables e-Discounting System (TReDS), the invoice discounting platform used primarily by small and medium enterprises to unlock working capital.

The push is driven by concerns over concentration risk, with the top three operators currently commanding around 90% of all transactions on the platform. Process notes have already been shared with industry participants, though implementation is expected to take time.

The Concentration Problem

Three platforms, RXIL, Invoicemart and M1xchange, have dominated TReDS since the system was operationalised in 2016-17. According to RBI data for May 2026, roughly ₹30 lakh crore of the ₹33 lakh crore total financed on the platform came through these three players. More than 50 banks work with the three incumbents, while newer entrants C2FO and KredX work with just 15 and 11 banks, respectively.

The RBI had flagged interoperability as a goal in its Payments Vision 2028 document released in March, and is now actively driving its implementation. The concern is that the market structure resembles what emerged on UPI, where business ended up concentrated with just two or three dominant players.

How Interoperability Would Work

Under the proposed framework, businesses registered on one TReDS platform would be able to transact with counterparties and financiers on other platforms. This would remove the current barrier that keeps buyers, sellers and lenders within a single ecosystem and would allow liquidity to flow more freely across the system.

The change is anticipated to help newer and smaller platform operators by giving them access to a larger pool of buyers and lenders without having to build those relationships from scratch. For the established players, the shift presents a business challenge due to the substantial investments they have made in building the ecosystem over the last decade. Industry participants, however, note that the three incumbents' dominance stems from their ten-year head start, and that as new entrants build scale, volumes will naturally spread.

Consolidation Happening Alongside

This regulatory push comes alongside consolidation in the TReDS space. M1xchange's subsidiary Mynd Fintech is in the process of fully acquiring C2FO India, which got a TReDS licence in 2024. The RBI continues to offer on-tap licensing, hoping to attract more players and expand the formal financing pie for small enterprises.

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