Which of the following statements about M1xchange's role in Micro, Small & Medium Enterprises (MSMEs) financing is/are correct? 1. M1xchange provides collateral based loans to MSMEs. 2. M1xchange facilitates discounting of invoices and Bills of Exchange for MSMEs. 3. M1xchange functions as a credit rating agency for MSMEs.

M1xchange is one of the three Trade Receivables Discounting System (TReDS) platforms approved by the RBI (others being RXIL and Invoicemart). TReDS is an electronic platform for facilitating the financing/discounting of trade receivables of MSMEs through multiple financiers. Statement 2 is correct as M1xchange facilitates discounting of invoices and Bills of Exchange enabling MSMEs to get early payment against their receivables. Statement 1 is incorrect because M1xchange does not provide collateral-based loans; it provides bill discounting (a form of receivables financing, not collateral-based lending). Statement 3 is incorrect as M1xchange is not a credit rating agency — credit rating in India is done by agencies like CRISIL, ICRA, CARE.