GeM Cuts Transaction Charges, Boosting Ease of Doing Business

GG News Bureau
New Delhi, 21st Sept. In a landmark move to foster ease of doing business, the Government e-Marketplace (GeM) has drastically reduced transaction charges for sellers and service providers, marking a significant step in its 100 days of governance initiative.

Effective from August 9, 2024, under the New Revenue Policy, the following key changes were implemented:

Zero Charges for Small Orders: Orders valued up to ₹10 lakh will now attract no transaction charges, up from the previous threshold of ₹5 lakh.

Reduced Fees for Larger Orders: Orders above ₹10 lakh and up to ₹10 crore will incur a 0.30% transaction charge, down from 0.45%.

Drastic Cut for Big Orders: For orders above ₹10 crore, a flat fee of ₹3 lakh will apply, a massive reduction from the previous cap of ₹72.5 lakh.

This overhaul ensures that approximately 97% of GeM transactions will not face transaction charges, with the remaining orders attracting nominal fees. The reduction in charges, ranging from 33% to 96%, is expected to enhance competitiveness among sellers, especially benefiting Micro and Small Enterprises (MSEs) by reducing financial barriers.

In the current fiscal year (2024-25), GeM has seen remarkable growth in service procurement, with services accounting for ₹1.39 lakh crore, or 65% of the total merchandise value of ₹2.15 lakh crore as of August 31, 2024. This surge is supported by over 325 service categories on the platform, streamlining public procurement for government buyers.

GeM, established in 2016, serves as a unified digital platform for end-to-end procurement by central and state governments, public sector enterprises, and other bodies. It was designed to modernize procurement systems, eliminating inefficiencies and corruption while promoting a transparent, paperless, and cashless ecosystem.