Question 1

What is Conditional Pay?

Accepted Answer

Conditional Pay (CP) is a payment mechanism where a buyer sets up an eNACH mandate that auto-debits their account — but only when a pre-agreed condition is met (delivery confirmation, milestone sign-off, or a defined day-count after invoice). The money stays in the buyer's account until that trigger fires.

Question 2

What is BizCollect?

Accepted Answer

BizCollect is an RBI-classified Technology Service Provider (TSP) building B2B trade payment governance infrastructure for Indian MSME supply chains. It does not hold, move, or custody money itself — it orchestrates the mandate, the trigger logic, and the audit trail between buyer and seller bank accounts through regulated partners: Cashfree for eNACH, South Indian Bank for the CP Secure bank-guarantee pilot, Leegality for e-sign, and WebNyay for dispute resolution.

Question 3

How is Conditional Pay different from a Post-Dated Cheque (PDC)?

Accepted Answer

A PDC executes on a date, regardless of whether the underlying delivery or milestone condition was met. It can bounce with no structured recourse trail. Conditional Pay executes on a verified trigger, not a calendar date — if the condition isn't met, the debit doesn't fire.

Question 4

How is Conditional Pay different from escrow?

Accepted Answer

In escrow, money physically leaves the buyer's account into a third-party custodial account before conditions are met. In CP, the money never leaves the buyer's account until the trigger fires — BizCollect does not hold or custody funds at any point.

Question 5

What happens if the buyer's account has insufficient funds when the trigger fires?

Accepted Answer

eNACH/NACH debits don't partially execute — if the full amount isn't available, the debit fails outright. A failed debit typically attracts a bounce/return charge from the bank. The event is recorded on the joint audit trail, which strengthens your position in any follow-up action or MSME ODR filing.

Question 6

What is Section 16 (MSMED Act) and Section 43B(h) (Income Tax Act)?

Accepted Answer

Section 16 — MSMED Act, 2006: if a buyer doesn't pay a Udyam-registered Micro or Small seller within 45 days of accepting goods/services, the buyer owes compound interest at 3× the RBI-notified bank rate. Section 43B(h) — Income Tax Act: a buyer can only deduct a MSME payable as a business expense if payment happens within the Section 15/16 timeline.

Question 7

What are the transaction fees on Conditional Pay?

Accepted Answer

Transaction fees depend on your plan, volume, and product tier (CP Lite vs CP Core). Reach out to the team at nitesh@bizcollect.in or call +91 98209 55686 for a quote specific to your business size and use case.

Question 8

Is BizCollect RBI-regulated?

Accepted Answer

BizCollect is classified as a Technology Service Provider (TSP) by the RBI. It does not hold a Payment Aggregator or Banking licence — it does not hold or move funds itself. eNACH mandates are processed through Cashfree Payments as the RBI-licensed Sponsor Bank.

Question 9

How does automated milestone payment compare to TReDS platforms like M1xchange, RXIL, and Invoicemart?

Accepted Answer

TReDS platforms are heavily buyer-driven and require high corporate credit ratings on the buyer side. BizCollect serves as a supplier-controlled alternative — it automates payments natively at the transaction level, eliminating reliance on the buyer's credit rating or bank-side approval workflows.

Question 10

Are Post-Dated Cheques (PDCs) enough to prevent delayed payments?

Accepted Answer

No. PDCs are a high-risk 'calendar bomb' — they either clear on a fixed date regardless of whether the underlying delivery dispute is resolved, or they bounce outright. They offer zero performance-linked protection: payment is tied to a date, not to verified conditions.

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