Bill Discounting Scheme

Bill Discounting is a working-capital finance facility whereby you, as an MSME, convert your unpaid invoices into immediate cash by selling them at a discount to a financing institution. The financier pays you a large portion of the invoice value upfront, and when the buyer settles, the financier receives the payment. This facility helps bridge the gap between delivery of goods/services and receipt of payment, thereby improving your cash-flow. It is offered by banks/NBFCs under their working capital/product lines for MSMEs. The purpose is to enable you to free up cash stuck in receivables, meet day-to-day expenses, growth opportunities or new orders. The benefit is quicker access to funds, reduced dependence on traditional loans, and smoother operations.

Key Features
Financial Assistance
Eligibility Criteria
Documents Required
Application Process for the Scheme

Key Features

Conversion of unpaid invoice into cash: You hand over a valid invoice (or bill of exchange) to the financier, and receive funds immediately instead of waiting for buyer payment.
Financing up to a high percentage of invoice value (typically 75-90%): You can receive a large share of the invoice value upfront, reducing your funding gap.
Interest/discount charge based on invoice amount, tenor and risk profile: The cost is the discount/interest rate applied until the invoice due date.
Minimal collateral required (in many cases invoice itself acts as security): Since the invoice is the underlying asset, sometimes no additional collateral is required.
Short-term tenure aligned with invoice due-date (30-180 days typical): The facility is short-term, matching the payment cycle of your customer.
Speedy processing and improved cash flow for MSMEs: Because the invoice is already raised and payable, the process is faster than conventional loans.
Applicable across manufacturing, trading, services MSMEs with credit-worthy buyers: The eligibility largely depends on the buyer’s credibility and the invoice being genuine and valid.

Financial Assistance

Component	Assistance Provided	Detailed Explanation & Example
Percentage of Invoice Value	Up to 75-90% of the invoice value	If you have an invoice for ₹10 lakhs due in 60 days, you may receive ₹7.5-9 lakhs upfront from the financier rather than waiting 60 days.
Discount/Interest Rate	Discount or interest charged till invoice maturity	Suppose discount rate is 2% for 60 days; on ₹10 lakhs you pay discount fee of ₹20,000 (approx) and receive ₹9.80 lakhs.
Tenure	Short-term (typically up to 180 days)	You receive the funds now and repay / financier recovers when the buyer pays at 60, 90 or 120 days.
Collateral Requirement	Often minimal beyond invoice and buyer credit	Because the receivable is due from a buyer, collateral may be limited; reduces your need to pledge assets.
Working Capital Impact	Improves liquidity, reduces waiting for payments	You convert debtors into cash, enabling you to meet payroll, buy raw materials, take new orders etc.

Eligibility Criteria

Who can apply:

You must be an MSME or enterprise raising invoices (credit sales) to reliable buyers.
Invoices must be genuine, valid and due on a specified date (with terms of credit clearly defined).
Your buyer should have acceptable credit standing (so that financier is comfortable).
You should have requisite business registration, GST, bank account and documentation as required by the financier.

Who can apply:

Invoices that are disputed, partially fulfilled or without clear payment terms may be rejected.
Transactions with unverified or very high-risk buyers may not qualify.
Invoices beyond a certain tenor may be unsuitable (too long-dated) for discounting.

Documents Required

Invoice(s) issued to buyer with clear due date/payment terms
Proof of supply/service (delivery challan, work completion certificate)\
Buyer’s credit details, payment history or purchase order
Your business registration proof (GST certificate, MSME/Udyam registration if applicable)
Bank account statements of your enterprise (recent months)
Financial statements or turnover proof (as required)
KYC of proprietor/director (PAN, Aadhaar)
Sometimes, buyer consent or acknowledgement of invoice may be required

Application Process for the Scheme

Option 1: Apply with Bullit (Recommended)

Click here to start with guided support. Our team verifies eligibility, compiles documents, and handles application & follow-ups on your behalf. You can monitor progress while focusing on operations.

Recommended for: MSME sellers wanting a smooth, assisted access to bill discounting.

Option 2: Official NSIC Route

Contact NSIC branch or the designated “Bill Discounting Scheme” cell at NSIC, and obtain the application form for bill discounting. (See NSIC scheme page)
Submit details of your supply transaction: bill/invoice value, buyer name & acceptance document, terms of supply, MSME registration certificate, etc.
NSIC (or its financing partner) evaluates the supplier’s credentials, buyer’s acceptance, risk profile, security/guarantee, and sanction limit.\
Upon approval, the bill is discounted (i.e., you receive immediate payment from financing partner less a discounting fee/interest).
When buyer pays, financing partner settles the transaction. If there is delay, the risk/guarantee conditions apply per scheme norms.

Option 3: Through Bank / Lending Partner Using Scheme Support
Many banks or NBFCs partner with NSIC under the scheme. You can approach your bank with your accepted bill and mention the NSIC Bill Discounting Scheme, seeking discounting under scheme terms. Bank will coordinate with NSIC for guarantee/security if required.