Cash flow problems are one of the biggest challenges faced by MSMEs in India. Even profitable businesses struggle when payments from buyers are delayed. Invoice factoring has emerged as a practical solution to this problem by allowing MSMEs to convert unpaid invoices into immediate working capital.
Today, many invoice factoring companies and digital platforms help MSMEs get faster access to funds without depending on traditional bank loans. These companies focus on invoice-backed financing, making it easier for small businesses to manage liquidity.
In this blog, we list the Top 10 Invoice Factoring Companies for MSMEs in India, with RXIL ranked at the first position, followed by other leading players in the market.
Invoice factoring is a form of receivables financing where a business sells its unpaid invoices to a financier or platform at a discount. The MSME receives a large part of the invoice value immediately, while the buyer pays the full amount to the financier on the due date.
Unlike traditional loans, invoice factoring:
With digital platforms and regulated systems, invoice factoring has become safer and more transparent for MSMEs.
RXIL is one of the leading and RBI-approved TReDs (Trade Receivables Discounting System) platforms in India. It plays a major role in providing invoice factoring and bill discounting solutions to MSMEs.
RXIL allows MSMEs to upload invoices raised on large corporates, PSUs, and government buyers. Once approved by the buyer, multiple financiers bid on the invoice, giving MSMEs access to competitive rates.
Key features of RXIL:
RXIL stands out for its transparency, compliance standards, and strong participation from banks and NBFCs, making it a top choice for MSMEs.
M1xchange is another RBI-approved TReDs platform that offers invoice factoring and bill discounting services. It connects MSMEs, buyers, and financiers on a single digital platform.
Highlights:
M1xchange is widely used by MSMEs supplying to large corporates.
Invoicemart, also known as A.TReDS, is a joint venture backed by leading financial institutions. It provides invoice factoring solutions through the TReDs framework.
Highlights:
Invoicemart is known for its robust risk management and compliance framework.
KredX is a well-known fintech platform offering invoice factoring and invoice discounting for MSMEs and startups. It focuses on quick access to funds using technology-driven processes.
Highlights:
KredX is popular among tech-enabled businesses and startups.
Drip Capital provides invoice factoring mainly for exporters and importers but also supports domestic MSMEs. It focuses on trade finance and receivables financing.
Highlights:
Drip Capital is suitable for MSMEs involved in international trade.
Vivriti Capital offers structured finance solutions, including invoice factoring and supply chain finance for MSMEs.
Highlights:
Vivriti Capital supports MSMEs with stable business operations.
Flexiloans provides working capital solutions, including invoice-based financing, for small and medium businesses.
Highlights:
Flexiloans helps MSMEs that need fast and short-term liquidity.
Indifi is a digital lending platform that offers invoice discounting and working capital finance to MSMEs across multiple sectors.
Highlights:
Indifi supports businesses with limited access to traditional funding.
Lendingkart is a fintech company that provides short-term business loans and invoice-based financing to MSMEs.
Highlights:
Lendingkart is known for easy access to credit for small businesses.
NeoGrowth offers invoice-backed financing and working capital solutions, mainly for retail and service-based MSMEs.
Highlights:
NeoGrowth supports MSMEs that have regular sales but delayed payments.
Before selecting an invoice factoring company, MSMEs should consider:
RBI-approved TReDs platforms like RXIL offer added safety, competitive pricing, and structured processes.
RXIL provides a balanced ecosystem where MSMEs, buyers, and financiers work together. It reduces dependence on traditional loans and helps MSMEs unlock funds tied up in receivables.
With its digital processes, transparent bidding mechanism, and regulatory backing, RXIL continues to play a key role in strengthening MSME cash flow and improving payment cycles.
Invoice factoring is becoming a critical tool for MSMEs to manage cash flow and grow without taking on heavy debt. With the rise of digital platforms and fintech solutions, MSMEs now have multiple options to choose from.
Among all available options, RXIL stands out as the most trusted and structured invoice factoring platform, followed by other strong players that cater to different MSME needs.
Choosing the right invoice factoring company can help MSMEs improve liquidity, reduce financial stress, and focus on business growth.
Invoice factoring is a financing method where MSMEs sell their unpaid invoices to a financier or platform to get immediate funds. Instead of waiting 30–90 days for buyer payments, businesses receive cash upfront, while the buyer pays the financier on the due date.
Invoice factoring is based on invoices raised on buyers, not on the MSME’s credit history or collateral. Business loans depend on financial statements, credit score, and guarantees. Invoice factoring does not create long-term debt on the balance sheet.
Yes, invoice factoring is safe when done through regulated platforms and established financiers. RBI-approved TReDs platforms like RXIL follow strict compliance, transparency, and risk control processes, making them reliable for MSMEs.
Any MSME that raises invoices on creditworthy buyers such as large corporates, PSUs, or government departments can use invoice factoring. The buyer’s approval of the invoice is usually required for financing.
RXIL is an RBI-approved TReDs platform that offers a transparent, digital, and competitive invoice factoring process. It allows multiple financiers to bid on invoices, helps MSMEs get better rates, and provides quick access to working capital without collateral.
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