EMD & performance security calculator
EMD (earnest money deposit) on an Indian government tender is ordinarily 2–5% of the estimated tender value, set by the buyer within the band GFR 2017 Rule 170 prescribes; Udyam-registered MSEs and DPIIT-recognised startups are exempt.
The rule
- EMD (bid security): 2%–5% of the estimated value of the tender — GFR 2017 Rule 170. Deposited with the bid; refunded to unsuccessful bidders after award.
- Performance security (ePBG): 5%–10% of the contract value — GFR 2017 Rule 171. Furnished by the winner after award, held through the contract period.
- Exemptions: Udyam-registered MSEs (Public Procurement Policy for MSEs Order 2012) and DPIIT-recognised startups are exempt from EMD in most central procurement, provided the certificate travels with the bid.
The tender document always prevails: buyers pick the figure within the band, GeM bids often fix an absolute amount, and relaxation Office Memoranda change rates from time to time. Use this as a planning estimate, not a quotation.
Worked examples
| Estimated tender value | EMD (2%–5%) | Performance security on award (5%–10%) |
|---|---|---|
| ₹5,00,000 | ₹10,000 – ₹25,000 | ₹25,000 – ₹50,000 |
| ₹10,00,000 | ₹20,000 – ₹50,000 | ₹50,000 – ₹1,00,000 |
| ₹50,00,000 | ₹1,00,000 – ₹2,50,000 | ₹2,50,000 – ₹5,00,000 |
| ₹1,00,00,000 | ₹2,00,000 – ₹5,00,000 | ₹5,00,000 – ₹10,00,000 |
Example, read in full: a tender with an estimated value of ₹10,00,000 will ordinarily ask for an EMD between ₹20,000 and ₹50,000; on winning, performance security between ₹50,000 and ₹1,00,000 replaces it. An exempt MSE deposits no EMD at all but still furnishes performance security on award.
Frequently asked questions
How much EMD do I pay on a government tender?
Under GFR 2017 Rule 170, bid security (EMD) is ordinarily set between 2% and 5% of the estimated tender value. The exact figure is the buyer's choice within that band and is stated in the tender document — many GeM bids fix an absolute amount instead of a percentage, so always read the bid document rather than assuming a percentage.
Who is exempt from paying EMD?
Udyam-registered micro and small enterprises (MSEs) are exempt from EMD under the Public Procurement Policy for MSEs Order 2012, and DPIIT-recognised startups are exempt in most central procurement. The exemption applies only if you attach the certificate with your bid — an eligible MSE that doesn't carry its Udyam number pays like everyone else.
When is EMD refunded?
Unsuccessful bidders get their EMD back after the contract is awarded. The winner's EMD is returned once performance security is furnished. EMD can be forfeited for withdrawing a bid during its validity or failing to sign the contract after award.
What is ePBG or performance security?
Performance security (on GeM, an electronic Performance Bank Guarantee — ePBG) is furnished by the WINNER after award, ordinarily 5–10% of the contract value under GFR 2017 Rule 171, and is held through the contract (and often the warranty) period. Later Office Memoranda have at times reduced the rate, so the tender document prevails.