M1xchange Raises $10 Mn To Boost Supply Chain Financing For MSMEs

SUMMARY

M1xchange has secured $10 Mn from investment firm Filter Capital through a secondary transaction

Founded by Sundeep Mohindru and Vivek Misra, M1xchange is a TReDS platform that facilitates financing of MSMEs based on invoice and bills

M1xchange claims to have discounted invoices and bills worth INR 1.7 Lakh Cr so far

Supply chain financing platform M1xchange has raised $10 Mn (around INR 84 Cr) from Filter Capital via a secondary deal.

The Delhi NCR-based startup is a Reserve Bank of India-licensed TReDS platform that facilitates financing to MSMEs based on invoice and bills.

Founded by Sundeep Mohindru and Vivek Misra, M1xchange has a network of more than 65 banks and 50K MSMEs. It claims to have discounted invoices and bills worth INR 1.7 Lakh Cr so far.

TReDS enables the discounting of trade receivables on an electronic platform for MSMEs through multiple financiers. The system has been envisaged with fostering transparency, ensuring timely payments and improving liquidity for small businesses.

“…we remain committed to driving financial access for MSMEs and creating long-term value for our stakeholders,” said Mohindru.

The development comes a month after Jindal Stainless along with its wholly-owned subsidiary, Jindal Stainless Steelway, acquired 9.62% stake in M1xchange.

Earlier in 2022, B2B ecommerce major IndiaMART and VC firm BEENEXT acquired additional stakes of 3.4% and 1.99% ,respectively in M1xchange for a total of INR 38 Cr.

Filter Capital closed its maiden CAT II AIF growth-stage fund – Filter Capital India Fund I – at $100 Mn last year. With its first fund, it invested in Capillary Technologies, Chalo Mobility, LoadShare Networks, and THB.

With increasing global trade, the need for an efficient supply chain is also growing and supply chain financing has become a key tool. Besides catering to MSMEs financing needs, supply chain financing also helps in managing complex cross-border trade.

As per the multinational bank Standard Chartered, adopting digital supply chain finance solutions could boost trade in Asia, Africa and the Middle East by 7.5% to $11.3 Tn by 2030, bridging the trade finance gap.

In India, TReDS platforms like RXIL, M1xchange, Invoicemart, C2treds and KredX enable MSME financing through invoice discounting. KredX is the latest one to have secured the license to operate as a TReDS platform. It received Reserve Bank of India’s (RBI) final approval to launch a TReDS platform in January.