Direct Purchase on GeM Portal (2024 Guide): Rules, Limits & Process Explained

The Government e-Marketplace (GeM) is a revolutionary step towards making public procurement transparent, efficient, and digital. It enables government departments, ministries, and public sector undertakings (PSUs) to purchase goods and services online in a simplified and transparent way. One of the most widely used methods of procurement on GeM is the Direct Purchase method. It is designed to help buyers procure low-value goods and services quickly while ensuring compliance with government financial rules and transparency standards. In this blog, we will understand what Direct Purchase is, who can use it, and how it benefits both buyers and sellers.

What is Direct Purchase on GeM? Direct Purchase is a procurement method available on the GeM Portal that allows government buyers to purchase goods and services directly from any available seller without the need for bidding or comparison, provided the order value is up to ₹50,000.
If the order value exceeds ₹50,000 but is up to ₹10 lakh, buyers must follow the L1 (Lowest Price) Purchase method — meaning they can buy from the seller offering the lowest price among at least three available sellers meeting the required specifications. For purchases above ₹10 lakh, the department must go for Bid or Reverse Auction, ensuring fair competition and price discovery.

Direct Purchase Thresholds (as per GFR and GeM Guidelines)

Up to ₹50,000 per transaction – Direct Purchase from any available seller on GeM meeting quality, specification, and delivery requirements.

Above ₹50,000 and up to ₹10 lakh – Purchase on L1 basis (from the seller offering the lowest price). Above ₹10 lakh – Purchase through Bid or Reverse Auction process. These limits are governed by the General Financial Rules (GFR), 2017 and regularly updated by the Ministry of Finance and GeM guidelines. How Direct Purchase Works on GeM The process of Direct Purchase is simple and entirely online. Here are the basic steps followed by a buyer: Search for Product/Service – The buyer searches for the required product or service on GeM using the search bar or category filters. Compare Listings – Buyers can compare different sellers based on specifications, price, delivery time, and rating. Add to Cart and Generate Order – Once satisfied, the buyer can directly add the item to the cart, generate a purchase order (PO), and issue it to the selected seller. Seller Acceptance – The seller accepts the PO, processes the order, and completes delivery within the specified time. Payment Release – After successful delivery and inspection, the payment is released directly to the seller through the GeM system. This process eliminates lengthy tendering procedures and ensures faster procurement for urgent or low-value requirements. Benefits of Direct Purchase The Direct Purchase feature on GeM offers several advantages to both buyers and sellers: For Buyers: Quick and transparent procurement process. Saves time and administrative effort. Access to verified and registered sellers. Ensures compliance with GFR rules. For Sellers: Opportunity to receive direct orders without competing in bids. Increased visibility and business growth. Faster order-to-payment cycle. Builds credibility and ratings on the platform. Key Points for Sellers to Remember To take full advantage of the Direct Purchase method, sellers must: Keep their listings updated and accurate with specifications, pricing, and stock availability. Maintain prompt delivery and quality standards to ensure good buyer ratings. Ensure compliance with GeM policies regarding catalog quality, product authenticity, and after-sales support. Respond quickly to new orders and maintain consistent performance to attract repeat buyers. Conclusion The Direct Purchase method is an excellent opportunity for MSMEs, startups, and small sellers to begin their journey on the Government e-Marketplace. With its simple process and low competition threshold, sellers can receive direct government orders without going through complex bidding procedures. To succeed, focus on maintaining accurate listings, competitive pricing, and timely delivery. These small steps can help you build a strong and credible presence on GeM and unlock steady business opportunities with government buyers.

If you want to learn more about selling on GeM or need expert guidance on registration, bidding, or catalog management, visit www.tenderwallah.com — your trusted GeM business partner.