Government e-Marketplace working on framework to ensure timely payments to sellers

While the time frame for payments is 10 days, it gets extended sometimes, creating problems for sellers. It is also looking at ways for banks to lend to sellers.

Public procurement portal Government e-Marketplace (GeM) is working on a framework for ensuring payment to sellers within a guaranteed time frame, a senior official said.

"We are working on a proposal wherein we will have a regime by which sellers would get payments in a specified time," said Talleen Kumar, GeM Chief Executive Officer.

At present, the time frame for payment is 10 days but it gets extended and causes problems for sellers.

GeM is also looking at ways through which banks can lend to sellers.

"Through this process, banks can provide working capital for MSMEs (micro, small and medium enterprises). We can give transaction data to banks and based on transaction history of a seller and looking at their performance and rating, banks can lend. This kind of facility is possible on GeM," he said.

Currently, MSMEs face problems in getting credit. For this, the platform is working on robust online seller and buyer rating mechanisms that will help sellers avail working capital loans where the cost of capital is linked to the performance and rating of sellers.

This will also help buyers to procure from highly rated sellers in critical areas of procurement, he said.

Further, he said the platform would set up a GeM Organisational and Transformation Team (GOTT) in buyer organisations on an outcome-based self-sustenance model to realign the procurement process in that organisation and leverage the marketplace procurement platform to its fullest potential.

GeM is also looking at ways to take on board artisans, weavers, and startups that are not recognised by the Department for Promotion of Industry and Internal Trade, and self-help groups on the platform so that they can offer their goods, a senior official said.

"We are working to give space for emporium products. The idea is how we can leverage GeM to increase incomes of artisans, weavers, and craftsman," he told reporters.

Work is underway to factor in technical solutions so that working capital and traceability of the items are available to buyers and sellers on the platform.

More than 3,000 startups are already registered on GeM and they have received orders amounting to Rs 522 crore till date.

Over 58,100 MSMEs are registered on the platform and they account for 50 percent of the entire transactional value, which stood at Rs 36,000 crore.

Further, he added that the commerce ministry is looking to widen the ambit of the platform by including government contractors and private entities for bulk-buying.

Currently, government departments, ministries, public sector units, state governments, and Central Armed Police Forces are allowed to carry out transactions through this portal.

The portal was launched in August 2016 for online purchase of goods and services by all the central government ministries and departments as well as states.

The portal provides wide ranging products from office stationery to vehicles. Automobiles, computers and office furniture are currently the top product categories.

Services, including transportation, logistics, waste management, webcasting and analytical, among others, are also listed on the portal.

(Edited by Saheli Sen Gupta)


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