BIS EMD and Financial Security in the Manakonline Tender

BIS EMD and Financial Security in the Manakonline Tender

BIS EMD and Financial Security in the Manakonline Tender

The BIS Manakonline Platform tender requires significant financial security deposits — Earnest Money Deposit (EMD) and Performance Bank Guarantee (PBG) — that reflect the scale and criticality of the Rs 150 Crore contract.

Earnest Money Deposit (EMD)

The EMD for the BIS Manakonline tender is Rs 3 Crore (Rs 30 million). This must be submitted with the bid to demonstrate the bidder's serious intent. The EMD is:

  • Refunded to unsuccessful bidders after contract award
  • Converted to Performance Bank Guarantee for the successful bidder
  • Forfeited if the winning bidder withdraws after award or fails to execute the contract

Performance Bank Guarantee (PBG)

The winning bidder must provide a Performance Bank Guarantee equal to 10% of the contract value — approximately Rs 15 Crore for the full Rs 150 Crore contract. The PBG:

  • Is held by BIS throughout the contract period
  • Can be invoked if the SI fails to meet delivery milestones or SLA requirements
  • Is released at contract completion after successful delivery

Payment Structure and Milestones

Payments are milestone-based, not time-based. The SI receives payment only upon successful delivery and BIS acceptance of each batch:

  • Each batch has defined deliverables and acceptance criteria
  • BIS UAT (User Acceptance Testing) must pass before milestone payment is released
  • Defects found during UAT must be fixed before payment — there is no partial payment for partially working modules

Liquidated Damages for Delays

The contract specifies Liquidated Damages (LD) for delivery delays. LD is typically 0.5% of the batch contract value per week of delay, capped at 10% of the total contract value. This creates strong financial incentive for the SI to deliver on schedule.

Why This Structure Matters

The EMD, PBG, milestone payments, and LD structure together create strong accountability for the System Integrator. BIS's critical national infrastructure cannot afford a half-delivered or abandoned IT project — the financial structure ensures the SI has significant skin in the game throughout the 7-year 4-month contract.