New Register for Workshop on How to start for NABARD 2025 (Stepwise Plan) - Apr 26, 7 PM

    Question

    In the context of a Trade Receivables Discounting System

    (TReDS), which of the following participants is responsible for accepting the factoring unit (FU) before it is discounted by a financier?
    A The seller (MSME) Correct Answer Incorrect Answer
    B The buyer Correct Answer Incorrect Answer
    C The confirming bank Correct Answer Incorrect Answer
    D The advising bank Correct Answer Incorrect Answer
    E The negotiating bank Correct Answer Incorrect Answer

    Solution

    In TReDS, the buyer is responsible for accepting the Factoring Unit (FU) before it is discounted by the financier. The FU represents a confirmed obligation from the buyer, and once accepted, it is used for financing or discounting by the financier.

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