What is EMD on GeM?
EMD (Earnest Money Deposit) is a security amount — typically 1–3% of the bid value — that sellers must deposit when submitting a GeM bid. It protects buyers if a winning bidder backs out.
On a ₹10 lakh bid, EMD can reach ₹30,000, tying up your working capital for the bid cycle. MSME sellers registered under Udyam can often skip this entirely.
Who qualifies for EMD exemption on GeM?
MSME sellers with a valid Udyam Registration Certificate (URC) are eligible for EMD exemption on most GeM bids under the Public Procurement Policy for MSMEs, 2012.
The exemption applies to Micro and Small enterprises. Medium enterprises and non-MSME sellers must pay EMD. Your Udyam certificate must be current — expired certificates are rejected at bid submission.
Which bids allow EMD exemption?
Central government bids on GeM almost always allow MSME EMD waiver. State government bids follow state-specific procurement rules, so the exemption may not apply on every portal order.
Some bid categories — particularly defence or security-sensitive — may require EMD regardless of MSME status. Always check the bid's Additional Terms and Conditions (ATC) before assuming exemption applies.
How to claim EMD exemption at bid time
During bid submission on GeM, select "MSME" under seller category and upload your Udyam Registration Certificate PDF. The system auto-waives EMD if your URC is valid and the bid allows exemption.
If the waiver option does not appear, verify your seller profile on GeM shows the correct MSME/Udyam status. Profile mismatches cause silent rejections of the exemption claim.
GemSetu's bid detail page shows whether MSME EMD exemption applies to a specific bid before you invest time preparing the submission. Start free at gemsetu.com/demo.