Govt, RBI looking to integrate GSTN with TReDS via account aggregator

The government and the Reserve Bank of India (RBI) are looking forward to integrating the Goods and Services Tax Network (GSTN) with TReDS (Trade Due Discount Scheme) platforms to enable direct penalties on SME, MSME and Micro enterprise bills.

The integration will ensure that electronic invoices raised by MSMEs on GSTN can come directly to the TReDS portal, eliminating the need for any additional activity or documentation, industry players said, adding that it could significantly improve the functioning of TReDS platforms over a period of time. time.

This will also speed up the underwriting and penalties process for loans because direct sourcing from the GST platform will provide more assurance and convenience to financiers regarding the sincerity of the invoices. In addition, you will assist in building an alternative credit database, especially for MSMEs with poor or minimal credit history.

secondary window

“The supplier and invoice data will flow through the platform, helping us to audit in a better way and also build a better data view for the vendor. So it will be very useful as a secondary window as we continue to add data, as we will have GST data as well as actual performance on the platform,” he said. An industry official said this would also help funders use this data for other distribution models.

The sources said that it is likely that the GST network will be integrated through the account pool model to ensure data privacy and security Business line.

“Discussions came to the conclusion that invoices can come not through the GST platform, but through the AA (Account Pool) form. GSTN will be registered as FIP (Financial Information Provider) and TReDS platforms as FIU (Financial Information User),” a source said. ) and thus they will receive all bills.

In February 2021, the Standing Committee on Finance chaired by Jayant Sinha recommended merging the TReDS platform with the GSTN electronic billing portal to allow real-time data sharing through a single window to access validated bills.

However, no decision has been made yet due to operational and implementation challenges and data sharing concerns, industry players said.

Better integration

“Now there are discussions about integration with all of the digital public infrastructure including GSTN, the Udyam registration platform and the government e-marketplace (GeM) portal. Either this could happen directly with the TReDS platforms if the government allows it, or then through the account aggregator,” he said. knowledgeable person

These mergers will also help the government track bills that are generated, penalty rates and rejections, thus encouraging more centralized PSUs to participate in TReDS.

“CPSEs have not arrived yet but we are seeing demand from states. This should only improve with the integration of government portals,” an official said. Goa and Tamil Nadu are already active and Madhya Pradesh, Uttar Pradesh and Haryana are expected to join TReDS soon.