What benefits and exemptions do MSEs get on GeM?

Price preference

On tenders where the lowest bidder (L1) is a non-MSE, an MSE bidder whose quote is within 15% of L1 gets a chance to match L1 and share the order (typically 25% of the quantity). This is one of the most commercially valuable benefits and applies across most GeM categories.

EMD exemption

MSEs are exempt from paying Earnest Money Deposit on GeM tenders across most product and service categories. This alone frees up significant working capital — a mid-size tender EMD can run into lakhs.

Tender reservation

All tenders with an estimated value up to ₹200 crore are reserved exclusively for MSEs, subject to a minimum of three technically qualified MSE bidders. This effectively locks large buyers into buying from MSEs for the vast majority of GeM procurement.

Sub-reservations

Within the MSE quota, 3% is reserved for women-owned MSEs and 4% for SC/ST-owned MSEs (as per the Public Procurement Policy). Verify these tags on your Udyam certificate — a wrongly categorised certificate blocks the benefit.

What you must do to claim benefits

1. Activate MSE benefits in your GeM seller profile after Udyam verification. 2. In each bid, explicitly select the MSE benefit checkboxes and upload a self-certified declaration when prompted. 3. Keep your Udyam certificate current — expired certificates disqualify the bid.

Ineligible categories

A handful of GeM categories — mostly defence, security and highly specialised technical products — are exempted from MSE reservation. GeM publishes the current exemption list; check before assuming reservation applies to your product.