M1xchange’s Deep-Tier Financing Platform Crosses ₹100 Crore Milestone, Redefining MSME Credit Inclusion

India’s credit landscape for micro, small and medium enterprises (MSMEs) is entering a new phase of transformation one where data, not collateral, drives access to capital. Marking a major milestone in this evolution, M1xchange, an RBI-licensed Trade Receivables Discounting System (TReDS) platform, has announced that its Small-to-Small (S2S) deep-tier financing solution has crossed ₹100 crore in monthly transactions.

This achievement underscores the rapid adoption of cash-flow-based financing among MSMEs, especially at the supplier and sub-vendor levels of India’s supply chains. Unlike conventional TReDS models that primarily facilitate corporate-to-MSME transactions, M1xchange’s S2S platform extends the framework further downstream, enabling MSME-to-MSME financing a crucial shift toward democratizing access to formal credit.

Through the S2S model, smaller enterprises can now receive timely financing for their purchases from other MSME vendors, eliminating payment bottlenecks and strengthening working capital cycles. This structure promotes financial trust, liquidity and growth across interconnected MSME supply chains, ensuring smoother operations from raw material procurement to finished goods.

According to Sundeep Mohindru, Promoter & Director of M1xchange, “Deep-tier financing represents the next phase of India’s MSME credit evolution. Crossing the ₹100 crore monthly milestone demonstrates growing trust in alternative credit frameworks. By enabling financing between MSME buyers and MSME sellers, we’re extending the reach of TReDS and strengthening supply chain liquidity.”

At the heart of M1xchange’s S2S model lies its proprietary Credit Analytics Engine (CAE) a technology that analyzes GSTN data, bank statements and historic TReDS transactions to assess an enterprise’s payment intent and capacity. By turning transactional data into credit intelligence, the model enables financiers to make faster, more accurate lending decisions while reducing reliance on traditional collateral-based underwriting.

Financiers on the M1xchange platform are increasingly using this data-led approach to fund smaller MSMEs with limited credit histories, enhancing credit penetration in a sector that contributes nearly 30% to India’s GDP and employs over 11 crore people.

India’s MSME credit gap is estimated at over ₹25 lakh crore. Deep-tier financing offers a structural answer to this challenge by formalizing liquidity flows between smaller enterprises, often excluded from conventional banking channels. The S2S mechanism unlocks liquidity not just for first-tier vendors but across entire supply chains, amplifying trade activity, profitability and resilience for the sector.

By enabling MSME buyers and sellers to transact within a trusted, transparent ecosystem, M1xchange is helping reduce delayed payments, one of the sector’s most persistent challenges. This approach aligns with the government’s Digital Public Infrastructure (DPI) vision, reinforcing a future where MSME credit is frictionless, digital and inclusive.

M1xchange aims to achieve ₹1,500 crore in annual throughput by FY 2025–26, double this by FY 2027, and reach ₹10,000 crore by FY 2030. Its rapid growth mirrors a broader trend within India’s trade finance ecosystem where platforms are moving from document-heavy workflows to real-time, data-verified and digitally underwritten credit systems.

This evolution signifies a paradigm shift from transactional lending to ecosystem financing one that treats trade data as an asset class and MSMEs as integral participants in India’s formal credit economy.

As India accelerates its MSME digitization drive, models like M1xchange’s S2S will likely become the blueprint for how small enterprises access credit: data-driven, transparent and scalable.