TradeCred: 10 Key Things You Must Know

Overview

TradeCred is an innovative fintech platform based in Mumbai, India, specializing in alternative debt solutions with a focus on invoice discounting and trade credit financing. Founded in 2018 by Hardik Shah and Kunal Tekwani, TradeCred leverages technology and machine learning to offer businesses access to working capital while providing investors with attractive short-term returns through invoice financing and other fixed income assets. It has emerged as a disruptive force in the Indian financial ecosystem, facilitating funding for startups and SMEs and managing assets totaling over ₹2,200 crore as of recent reports. Readers will find intriguing insights into TradeCred’s business model, its impact on India’s MSME financing landscape, notable funding deals, challenges, and its growing portfolio of clients and investments.

1. Origins and Business Model

TradeCred was established in 2018 in Mumbai with a mission to address the working capital challenges faced by small and medium-sized enterprises (SMEs) and startups. The platform operates as an alternative debt platform, primarily using invoice discounting—a process whereby businesses sell their unpaid invoices to investors at a discount to immediately access funds. Utilizing advanced algorithms and credit risk models powered by machine learning, TradeCred evaluates invoice genuineness and creditworthiness, effectively bridging the gap between investors seeking fixed-income opportunities and businesses needing short-term credit. This model has helped the company grow rapidly and secure a niche within India's fintech sector.

2. Platform Features and Solutions

TradeCred offers multiple financial solutions beyond invoice discounting, including leasing, settlement financing, sovereign and corporate bonds, and asset financing. Its proprietary risk algorithm, driven by over 120 input machine learning models, allows the platform to maintain a reputed zero-default record over several years, fostering investor confidence. The platform caters to high net-worth individuals (HNWIs) and institutional investors, providing returns typically ranging from 12-16% annually over short durations (30 to 90 days). TradeCred’s platform boasts a user-friendly interface and transparency, allowing investors to monitor their portfolios, transact on blue-chip invoices, and benefit from flexible investment tenures.

3. Funding and Growth Trajectory

As a bootstrapped startup, TradeCred has raised modest external funding, including a $140,000 angel round in early 2020 led by investor Vishal Gupta. Despite limited venture capital financing, the company has shown steady growth, managing assets over ₹2,200 crore and serving more than 20,000 active users. TradeCred has expanded its investment portfolio by backing over a dozen startups, including sectors like e-commerce and B2B services. The company has gained recognition for facilitating large financing deals, including a notable ₹300 crore debt arrangement with e-commerce brand Mensa Brands and asset financing partnerships with firms such as Furlenco (House of Kieraya) securing $15 million in financing.

4. Market Impact and Clientele

TradeCred has positioned itself as a leader in India's alternative debt space, empowering businesses with quick, collateral-free access to capital through invoice financing. Its client base includes SMEs, startups, and fast-growing D2C brands, many of which have benefitted from TradeCred’s ability to shorten working capital cycles, thereby enabling significant business growth. For investors, TradeCred presents a diversified portfolio of investment opportunities across verified invoices from large companies like Jio, Amazon, and Flipkart, increasing confidence in repayment and reducing credit risk exposure.

5. TradeCred’s Role in MSME Financing

India’s MSME sector has historically faced difficulties in obtaining timely and adequate working capital funding, constrained by traditional banks’ stringent collateral requirements and lengthy approval processes. TradeCred taps into this gap by offering invoice discounting as a scalable and technology-enabled solution, enabling MSMEs to monetize their receivables early. This not only aids cash flow management but also contributes to strengthening India’s digital economy initiatives by fostering credit flow in underserved sectors.

6. Notable Investments and Portfolio Companies

TradeCred actively invests in early and seed-stage companies primarily in the e-commerce, B2B, and fintech sectors, targeting emerging players in major cities like Bengaluru, New Delhi, and Gurgaon. Its portfolio includes investments in startups such as Clensta, ZippMat, and Fashinza. By functioning both as a financial intermediary and an investor, TradeCred diversifies its risk and aligns its growth strategy with the startups it supports.

7. Controversies and Challenges

In mid-2025, TradeCred became the complainant in a high-profile case involving supply chain finance startup Bizongo. TradeCred filed a criminal complaint alleging the misappropriation and fraudulent diversion of funds amounting to over ₹69 crore related to unpaid invoices sold on its platform. The complaint claims Bizongo failed to route customer payments to escrow accounts as required, resulting in double recovery and defrauding TradeCred’s investors. Bizongo, however, denied these allegations and stated it was actively repaying dues and transitioning its business model. This dispute has brought scrutiny to TradeCred’s invoice discounting business, highlighting the challenges fintech platforms face in maintaining transparency and compliance in alternative lending markets.

8. Competition and Industry Landscape

TradeCred operates in a competitive alternative debt and invoice financing market alongside firms like KredX, FundThrough, Sonovate, and others, each varying in scale and funding. While TradeCred maintains a relatively smaller valuation compared to global peers, it differentiates by its advanced risk algorithms and focus on India’s underserved SME segment. The alternative lending space is characterized by fragmented players, regulatory challenges, and evolving investor preferences seeking higher yields in a low-interest-rate environment.

9. Technological Innovation and Credit Risk Assessment

At the core of TradeCred’s offering is its patented trade-focused credit risk algorithm that uses machine learning to analyze extensive invoice data, buyer payment history, and seller credibility. This technology-driven approach enables rapid, data-based credit decisions, which reduces turnaround times for approvals to within 36 hours and disbursal in 7 days. Such innovation has allowed the company to manage risk effectively, maintain zero default rates, and uphold investor trust in a relatively new asset class.

10. Future Prospects and Developments

TradeCred’s future strategy involves broadening its alternative debt offerings, expanding its client base of UHNWIs, and enhancing technological infrastructure for greater automation and transparency. The company aims to deepen penetration within India’s MSME lending ecosystem while exploring international collaborations. However, it must navigate increased regulatory scrutiny, competition, and reputational risks emerging from recent controversy. The evolving fintech landscape and demand for diverse fixed-income products present significant growth opportunities for TradeCred if it maintains operational rigor and continues innovation.

Conclusion

TradeCred represents a pioneering fintech platform in India’s alternative debt and trade credit financing ecosystem, offering a win-win for businesses needing liquidity and investors seeking higher fixed-income returns. Founded in 2018, the company has grown to manage over ₹2,200 crore in assets, facilitated significant debt financing rounds, and invested in promising startups. TradeCred’s technology-driven credit evaluation models and curated invoice financing have created an efficient marketplace connecting capital to deserving enterprises. Despite facing challenges such as the Bizongo dispute and stiff competition, TradeCred’s niche positioning and stakeholder trust underscore its importance in enhancing India’s MSME financing landscape. How TradeCred balances growth with regulatory compliance and manages controversies will be key determinants of its long-term impact on India’s financial innovation narrative.