What Is Government E-Market (GeM)?
Several government agencies, organizations, and public sector undertakings in India use the Government E-Market place to promote and allow easy online procurement of goods and services. This platform exists solely to improve public procurement accountability, quality, and efficiency. It provides reverse e-auction, e-bidding, and demand aggregation resources to help government users to get the most value for money. To escape cutthroat competition, many MSMEs, suppliers, and service companies agree that selling to the government is a better option than seeking customers. The Ministry of Finance has approved and made obligatory purchases by government users via GeM by introducing a new Rule No. 149 to the General Financial Rules, 2017.
It functions similarly to an e-commerce marketplace like Amazon or Flipkart, except that GEM’s buyers are only government agencies, and sellers can be anybody who has registered on the GEM portal. The GEM registration process is simple and uncomplicated for companies, and there is no GEM registration charge.
Who is eligible to buy/purchase through GeM?
All Central and State Government Ministries/Departments, as well as their attached/subordinate offices, Central and State autonomous bodies, Central and State Public Sector Units, and local bodies, are allowed to use the GeM portal for procurement.
How to do Registration in GeM?
The GEM registration process for businesses (or sellers) is clear and simple, and it can be completed via the GEM portal. The sellers can be confident of the least expensive way to enter GEM and begin selling their services and goods since there is no GEM Registration free. Some prerequisites should be met by the seller before the registration:
- The name of the registered company and the records associated
- The user’s Aadhaar card and PAN card (mandatory requirement)
- The registered business’s mobile number
- CIN, PAN, DIPP, UAM, and ITR are required documents.
- Register address
- Details of bank account
- The email address that is currently active
- Sellers may not have to pay a GEM registration fee. For all sellers and companies, the GEM registration process is completely free. However, from June 1, 2020, the Government of India will implement a monetization policy for GEM portals that will apply to all sellers.
- If a seller’s Seller Merchandise Value (SMV) exceeds Rs 20 lakh in a calendar year, they will be allowed to pay a one-time fee of Rs 10,000 to remain active as a seller on the GEM portal.
- If a seller’s SMV has already crossed Rs 20 lakh, a processing fee will be applied on all orders worth Rs 5 lakh or more. It will be determined by the worth of the products and services provided.
- If the order value is between Rs 5 lakh to Rs 50 crore, the sellers will be charged a 0.5 percent transaction fee.
- If the order value is between Rs 50 crore and Rs 100 crore, the fee is 0.5 percent for the first Rs 50 crore (which is Rs 25 lakh) + 0.4 percent for the next Rs 50 crore (which is Rs 20 lakh) + 0.3 percent for every order value above Rs 100 crore.
- If the order value exceeds Rs 200 crore, the customer will be paid 0.5 percent for the first Rs 50 crore (which is Rs 25 lakh) + 0.4 percent for the next Rs 50 crore (which is Rs 20 lakh) + 0.3 percent for the next Rs 100 crore (which is Rs 30 lakh) + 0.2 percent for orders above Rs 200 crore.
Benefits of Gem-
- Full access to a national procurement portal that is centralized. This would result in a significant increase in business opportunities across India.
- There is no registration charge for GEM.
- MSMEs and startups receive special quotas and incentives, as well as guaranteed procurement in certain categories.
- There is no need for any documentation since the process is entirely online.
- Both sellers and buyers have access to a comprehensive online dispute redress system.
- Easy-to-use dashboard for tracking revenue and analyzing patterns.
- ITR filings are also waived for sellers from the Northeast and J&K.
- Since market dynamics and the demand-supply ratio will influence pricing, it will be dynamic.
In India, MSME and GeM-registered businesses play an important role in achieving self-sufficiency. The platform allows sellers to set fair market rates while still keeping track of demand for the goods and services in which they work. The GeM platform offers Indian sellers a paperless and contactless business opportunity.