M1xchange Expands MSME Credit with S2S Deep-Tier Financing

India’s credit ecosystem for micro, small, and medium enterprises (MSMEs) is witnessing a structural shift toward data-driven, deep-tier financing models. M1xchange, an RBI-licensed TReDS platform, today announced that its Small-to-Small (S2S) deep-tier financing platform has crossed ₹100 crore in monthly transactions; signalling growing adoption of cash-flow–based lending that reaches smaller enterprises across supply chains.

While traditional TReDS platforms have focused primarily on corporate-to-MSME financing, S2S extends this framework to enable MSME-to-MSME transactions. The model allows smaller vendors and ancillary suppliers to access formal credit based on validated trade data rather than collateral or balance sheet strength, improving liquidity and resilience throughout the supply chain.

Through S2S, MSMEs gain access to timely financing for procurement from other MSME vendors, thereby promoting higher trade volumes within the MSME ecosystem and ensuring reliable, on-time payments between MSME buyers and sellers.

Sundeep Mohindru, Promoter & Director, 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.”

M1xchange’s model leverages a Credit Analytics Engine (CAE) that draws insights from GSTN, bank statements, and TReDS transactions to evaluate payment capacity and intent. This data-led approach improves underwriting accuracy, reduces dependency on collateral, and accelerates access to affordable working capital for MSMEs. By making both purchase and sales data of MSMEs available from the M1 TReDS platform, S2S is garnering growing interest and trust from financiers, who are leveraging this data to extend credit access across the MSME ecosystem.

India’s MSME sector, contributing roughly 30% to GDP and employing over 11 crore people, continues to face a credit gap exceeding ₹25 lakh crore. Deep-tier financing models such as M1xchange’s are increasingly seen as a scalable solution to bridge this divide by enabling cash-flow–based lending at lower ticket sizes. The Additional liquidity through S2S is helping MSMEs improve profitability and growth by strengthening both upstream and downstream supply chain flows.

M1xchange aims to achieve ₹1,500 crore in annual throughput by FY 2025–26, double this volume by FY 2027, and cross ₹10,000 crore by FY 2030. The platform’s growth reflects a broader movement within India’s trade finance ecosystem toward technology-driven credit inclusion, standardized risk assessment, and transparency.