EMD in a tender: earnest money deposit explained
EMD (Earnest money deposit, or bid security). The refundable bid security a bidder lodges to take part in a tender, ordinarily 2% to 5% of the estimated value under GFR Rule 170. The General Financial Rules call it bid security.
Checked against its sources on 23 September 2026.
How much, and for how long
GFR 2017 Rule 170 says bid security should ordinarily range between 2% and 5% of the estimated value of what is being procured. The buyer fixes the exact figure and states it in the tender. It has to remain valid for 45 days beyond the final bid validity period.
On GeM the amount is in the bid document. CPWD's eTender portal shows it in the listing itself. A CPPP listing generally does not carry it, and the detail page sits behind an image code.
Who does not pay it
Micro and small enterprises with Udyam registration, and DPIIT-recognised startups, are exempt from bid security. The MSE exemption applies to goods the MSE manufactures and services it provides; traders and resellers do not get it.
The exemption is from EMD only. An exempt bidder that wins still furnishes performance security.
The bid security declaration
Under Rule 170(iii) a buyer may accept a bid security declaration instead of EMD: a signed undertaking that the bidder will be suspended from bidding for a stated period if it withdraws or breaks the bid conditions. It is at the buyer's discretion. A Department of Expenditure order made declarations mandatory for tenders issued up to 31 December 2021; that period ended.
Where ScanX reads this for you
For every GeM match, ScanX opens the bid document and puts this field in the row you receive, read from the document itself rather than typed by us.