The MoU would allow the two banks to provide for the transfer of funds through GeM Pool Accounts (GPA), advising of Performance Bank Guarantees (e-PBG), Earnest Money Deposit (EMD) and payment gateway to GeM users.
Online platform for public sector units and government departments — Government e-Marketplace (GeM) to procure goods from MSME sellers and others has signed a memorandum of understanding (MoU) with Indian Bank and Canara Bank to facilitate cashless, payment system; and boost efficiency in procurement system for government entities, Commerce Ministry announced on Friday in a statement. The MoU would allow the two banks to provide for the transfer of funds through GeM Pool Accounts (GPA), advising of Performance Bank Guarantees (e-PBG), Earnest Money Deposit (EMD) and payment gateway to the registered users on GeM.
The portal has already signed a similar MoU with 18 scheduled commercial public sector and private banks. It currently has 57,586 micro and small (MSE) sellers and service providers, out of total 294,054 seller count, providing over 14 lakh products and 18.6k services, according to the data available on the website. In terms of buyers, the portal has 39.8k buyer organisations.
The number of orders made, according to the portal stands at 26.22 lakh and a transaction value of Rs 36,811 crore. Importantly, over 50 per cent of the order value for GeM portal comes from MSE sellers.
GeM also works with banks, Trade Receivables Discounting System (TReDs), and SIDBI to offer bill discounting and financing of working capital. “The cost of capital is linked to the performance and rating of a seller on GeM. This will help sellers in general and MSMEs, in particular, to access easy credit and do better business with the government,” the ministry said. The portal is also looking at setting up of EMD pool account for sellers to easily comply with the EMD requirements while responding to bids.
MSME Minister Nitin Gadkari had in August this year announced its e-commerce portal Bharat Craft on the lines of Alibaba to benefit India’s MSME sector.