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23/05/2017 12:49pm

MSMEs not required to pay earnest money or security money in govt tenders: Kalraj Mishra

image MSMEs not required to pay earnest money or security money in govt tenders: Kalraj Mishra

New Delhi, May 23 (KNN) Interacting with the MSME entrepreneurs live through social media platform on Monday, Union MSME Minister Kalraj Mishra reiterated that the micro, small and medium enterprises (MSMEs) are not required to deposit any earnest money in the tenders.

He said, for MSMEs there are no requirements of security money, earnest money, turnover requirement etc in the government tenders.

Mishra was answering to a query from an MSME entrepreneur on whether the MSMEs can get any relief in earnest money deposits in the government tenders.

Mishra said, for MSMEs, there is L1 +15 percent relief along with 20 per cent mandatory procurement criteria from the MSMEs.

According to the Public Procurement Policy all central government agencies have to ensure that at least 20% of their procurement is from the Micro and Small sector (excluding Medium enterprises). Further, 4% of total procurement (20% of the total MSE share) has to be from SC/ST entrepreneurs. It has been operationalized through Government order duly approved by the Cabinet.

Under the policy, tender sets free of cost and exemption from payment of earnest money to registered MSEs.

MSEs quoting price within price band L-1 + 15%, when L1 is from someone other than MSE, shall be allowed to supply at least 20% of tendered value at L-1 subject to lowering of price by MSEs to L-1. (KNN Bureau)


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  1. kotian
    kotian 05/07/2018 5:30 PM

    i am new entrepreneur and civil contractor ,newly registered in udyog adhar and i have the udyog adhar no , i have applied for the central government tender , but i do not have work order and work completion certificate required for same work mentioned in tender. Does Pradhan mantri yojana has any exemption for new comer and young contractor with udyog adhar.

    Reply to this comment
  2. Debashis
    Debashis 11/06/2018 6:19 AM

    Hello Mr. Mohan, As per the PPPMSE you are eligible for exemption from earnest money deposit in central PSUs as micro and small enterprise. Bank Guarantee cannot be waived….

    Reply to this comment
  3. mohan
    mohan 11/06/2018 5:06 AM

    We are MSME registered company in Tamil Nadu used to participate central and state governments tenders across the country. Can we avail any exemption or relexation on Performance Bank Gurantee & Earnest Money Deposit?

    Reply to this comment
  4. Debashis
    Debashis 03/05/2018 12:21 PM

    Hello Mr. Pradosh Behura. Yes, your UAM Number is sufficient to avail benefits under the public procurement policy. However, we would recommend you to also upload information in MSME databank for availing other benefits from the Government schemes. The online portal is of same name.

    Reply to this comment
  5. Pradosh Behura
    Pradosh Behura 02/05/2018 11:07 AM


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  6. Debashish
    Debashish 09/02/2018 12:02 PM

    Hello Mr. Senthil Kumar, Public procurement policy widely varies from state to state. Some states like U P has announced EMD exemption for MSMEs. For Kerala you may check with the Government. You may also like to contact your association to take up the issue with the State government.

    Reply to this comment
  7. Senthilkumar
    Senthilkumar 09/02/2018 10:55 AM

    I am Manufacturer in TamilNadu. Can i Claim EMD Exemption in Kerala Govenment Tenders Using MSME?

    Reply to this comment
  8. santhosh
    santhosh 02/02/2018 7:33 AM

    kindly give a latest govt orders for msme and nsic benefits

    Reply to this comment
  9. Debashis
    Debashis 19/01/2018 9:09 AM

    No your Udyog aadhar document is sufficient

    Reply to this comment
  10.  D kumar
    D kumar 06/01/2018 11:54 AM

    please inform weather security deposit clause is applicable to MSME or NSIC register contractor is security deposit applicable in following NAV RATNA Government company's 1) ONGC Ltd Hazira Surat, Gujarat 2) Rashtriya Chemicals and Fertilizers ltd,

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  11. Debashis Bandyopadhyay
    Debashis Bandyopadhyay 04/12/2017 6:24 AM

    No. But we would advise you to upload your data in MSME Database also. It is online at the portal of same name….

    Reply to this comment
  12. Unni Krishnan
    Unni Krishnan 03/12/2017 10:19 AM

    Is there any documents required other than msme memorandum to get exemption from Tender form fee & EMD ?

    Reply to this comment

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