GeM Policies for Startup & MSME Sellers: Special Benefits & How to Avail Them

The Government e-Marketplace (GeM) is a revolutionary platform aimed at streamlining public procurement in India. It provides a transparent and efficient way for businesses, including startups and Micro, Small, and Medium Enterprises (MSMEs), to sell their products and services to government buyers. Recognizing the importance of these sectors in economic growth, GeM has introduced several policies and benefits tailored specifically for startups and MSME sellers.

Special Benefits for Startups & MSMEs on GeM

1. Exemption from Prior Experience & Turnover Criteria

One of the most significant advantages for startups and MSMEs on GeM is the relaxation from stringent eligibility criteria. Unlike traditional procurement processes, where prior experience and turnover requirements can be a barrier, GeM allows eligible startups and MSMEs to bid for government contracts without these constraints.

2. Preferential Treatment in Bidding

MSMEs registered under the Udyam Registration framework and startups recognized by the Department for Promotion of Industry and Internal Trade (DPIIT) are given preference in government tenders. This ensures that smaller businesses can compete with established players.

3. Reduced Security Deposit Requirement

To ease financial strain, MSMEs and startups enjoy a reduced Earnest Money Deposit (EMD) or even complete exemption in some cases. This allows them to participate in more tenders without the burden of hefty security deposits.

4. Benefits under the Public Procurement Policy

The Public Procurement Policy mandates that at least 25% of government procurement must be sourced from MSMEs. Furthermore, 3% of this is reserved for women entrepreneurs, and 4% for Scheduled Caste (SC) and Scheduled Tribe (ST) owned businesses, enhancing inclusivity in public procurement.

5. Exclusive Access to Startup Runway

GeM offers a dedicated section called the ‘Startup Runway,’ which provides startups with a platform to showcase innovative products and services directly to government buyers, bypassing the conventional tendering process.

6. Faster Payments through TReDS

The Trade Receivables Discounting System (TReDS) enables MSMEs to receive faster payments by discounting their invoices. This ensures a steady cash flow and minimizes payment delays from government buyers.

7. Access to OEM (Original Equipment Manufacturer) Panel

Startups and MSMEs manufacturing unique or patented products can register as OEMs on GeM, providing them with higher visibility and credibility in the marketplace.

How to Avail These Benefits?

1. Register on GeM as an MSME or Startup

Visit GeM Portal and create an account.
Ensure that your business is registered under the Udyam framework (for MSMEs) or recognized by DPIIT (for startups).
Complete the necessary documentation and verification process.

2. Apply for Exemptions & Preferences

Opt for EMD exemption while bidding.
Utilize the Startup Runway for direct government engagements.
Ensure your business qualifies under the Public Procurement Policy for preferential treatment.

3. Maintain Compliance & Quality Standards

Adhere to government procurement standards to build credibility.
Provide competitive pricing and timely delivery to secure repeat orders.

4. Leverage Additional Support Services

Use TReDS for faster invoice payments.
Seek support from GeM’s grievance redressal mechanism in case of payment or procurement disputes.

Conclusion

The Government e-Marketplace (GeM) provides a game-changing opportunity for startups and MSMEs to access government procurement markets. By leveraging the special policies and benefits available, small businesses can scale rapidly while contributing to India’s economic growth. Registering on GeM and strategically utilizing these advantages can open doors to significant business expansion and long-term success.