Quick Summary
Government provides a big relief to MSMEs for COVID-19 period; fulfils promise announced in Union Budget 2023-24 95% of bid or performance security forfeited for failure to execute contracts to be refunded; No interest shall be paid on such refunded amount Relief provided in all contracts for procurement of Goods and Services, entered into by Ministry/ Department/ CPSE etc. with MSMEs The Ministry of Finance today provided a major relief to Micro, Small and Medium Enterprises (MSMEs) fo
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FAQ :
MSMEs will receive a refund of 95% of their bid security, performance security, and liquidated damages that were forfeited during the COVID-19 pandemic period.
Eligible MSMEs must have been registered with the Ministry of MSME as of 31st March 2022, and their contracts for goods and services must have had an original delivery or completion period between 19th February 2020 and 31st March 2022.
The relief applies to all contracts for procurement of Goods and Services entered into by any Ministry, Department, attached or subordinate office, autonomous body, Central Public Sector Enterprise (CPSE), or Public Sector Financial Institution with MSMEs.
No, interest will not be paid on the refunded amounts.
MSME vendors will be able to register on the Government e-Marketplace (GeM) portal to enter details of applicable contracts, and the process for applications will be notified separately.
If an MSME was debarred solely due to default in executing contracts covered by this relief, their debarment will be revoked. However, no claims will be entertained if a firm was ignored for contract placement due to debarment during the interim period.
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