What is an ePBG in GeM?
An Electronic Performance Bank Guarantee (ePBG) is an online performance security submitted by a winning bidder (L1 vendor) on the GeM portal after receiving a contract or order award.
It typically ranges between 3% to 10% of the total order value and serves as financial security to guarantee that the supplier fulfills all contractual obligations, warranty commitments, and delivery schedules specified by the government buyer.
Why is Proper ePBG Submission Crucial?
Submitting an ePBG within the stipulated timeframe (usually 15 days from contract issuance) is essential to protect your order from cancellation and severe penalties:
Contract Confirmation
Failure to submit a valid ePBG on time can lead to contract cancellation and forfeiture of EMD or vendor suspension.
SFMS Real-Time Verification
GeM uses Structured Financial Messaging System (SFMS) integration with banks for automatic online verification, eliminating manual delays.
Smooth Bill Processing
Once the ePBG is verified and accepted by the buyer online, the order status shifts to active fulfillment, unlocking invoice submission.
Risk-Free Return Post Warranty
Properly logged ePBGs ensure prompt online release by the buyer once the delivery and warranty period expire successfully.
Step-by-Step ePBG Generation & Submission Process
Our consultants guide you step-by-step through the structured bank and GeM portal workflow:
- Contract Clause Review: Analyze required PBG value, validity duration (contract period + warranty + 2 months buffer), and issuing bank rules.
- SFMS Instruction Draft: Prepare exact advisory text and SFMS code details to share with your bank's guarantee department.
- Bank Issuance & SFMS Push: Ensure your bank transmits the electronic message to the buyer's designated advisory bank on GeM.
- GeM Portal Mapping: Enter bank guarantee details, SFMS reference numbers, and upload original copies on the seller dashboard.
- Buyer Approval & Tracking: Follow up with the buyer/DDO for online acceptance and track validity extension or final release.
Documents Required for ePBG Setup
For Bank Guarantee Issuance
- GeM Generated Award of Contract (AOC) / Purchase Order
- Buyer's Advisory Bank Details & IFSC SFMS Code (from PO document)
- Company Financials / Security Margin for Bank Facility
For Portal Upload & Verification
- Physical or e-Stamped Bank Guarantee Copy
- Bank SFMS Acknowledgment Receipt / UTR Reference
- Authorized Signatory Portal Access
ePBG Consultancy Fee Structure
| Service Package | Scope of Consultancy | Consultancy Fee |
|---|---|---|
| Single Order ePBG Setup & Portal Mapping | Clause verification, bank draft advisory, SFMS verification guide, and portal submission for 1 contract | ₹1,999 + GST |
| End-to-End ePBG Management & Release Advisory | Complete submission assistance, extension compliance, buyer escalation, and post-contract release tracking | ₹3,999 + GST |
Frequently Asked Questions (FAQs)
1. What is the time limit for submitting an ePBG on GeM?
Standard GeM terms require submission of the ePBG within 15 calendar days from the date of contract award, unless extended explicitly by the buyer in custom contract clauses.
2. What is SFMS and why is it mandatory for ePBG?
Structured Financial Messaging System (SFMS) is a secure messaging protocol used by banks to transmit guarantee data directly to the buyer’s bank, preventing fraudulent paper guarantees on GeM.
3. Are MSEs and Startups exempt from ePBG on GeM?
No. While MSEs and Startups are often exempt from EMD (Earnest Money Deposit), Performance Security (ePBG) is generally compulsory for all awarded vendors to safeguard delivery execution.
4. How and when is the ePBG released back to the seller?
The ePBG is released online by the buyer/consignee through the portal after completion of all contract obligations, including the defect liability/warranty period.
*Note: Document requirements and Service Fee may vary by tender, category and registration type. Tendershala's consultants confirm the exact checklist and service fee that applies to your specific requirement.