UPSC Prelims Practice Questions — RBI tweaks process to onboard MSMEs on TReDS platform

Q1. The Trade Receivables Discounting System (TReDS), as regulated by the RBI, is best described as which one of the following?

  • A. An electronic platform for the financing/discounting of trade receivables of MSMEs through multiple financiers
  • B. A guarantee fund that solely compensates banks for all defaults on MSME term loans
  • C. A government grievance portal exclusively for registering delayed-payment complaints by MSMEs
  • D. A digital ledger meant only for archiving GST invoices generated by MSMEs

Q2. Entities seeking to set up and operate a TReDS platform must obtain authorisation from which one of the following?

  • A. Reserve Bank of India
  • B. Securities and Exchange Board of India
  • C. Ministry of Micro, Small and Medium Enterprises
  • D. National Bank for Agriculture and Rural Development

Q3. TReDS platform operators are required to be companies incorporated in India and authorised under which one of the following statutes?

  • A. Payment and Settlement Systems Act, 2007
  • B. Factoring Regulation Act, 2011
  • C. Micro, Small and Medium Enterprises Development Act, 2006
  • D. Banking Regulation Act, 1949