new Delhi. Government departments and agencies will be required to pay interest on late payments to most MSMEs to vendors for products purchased through the Government e-Marketplace (GEM). This system will be applicable from October 1. The Department of Expenditure of the Ministry of Finance on Friday said through an office memorandum that if the payment is not made within 10 days of the automatic receipt of consent receipt and acceptance certificate (CRAC) or issued by the buyer, then the concerned department For the delay in payment, interest will have to be paid at the rate of one percent monthly.
The Office Memorandum states that this interest, however, will not go to the concerned MSMEs and will instead go to an account operated by GEM, which will be used only for the education of buyers and sellers or for public procurement after prior approval of the Department of Expenditure.
In a tweet from the office of Finance Minister Nirmala Sitharaman said, “In order to promote good discipline of timely payment to vendors, especially MSMEs, the government is in respect of interest on late payment to vendors on the government e-marketplace Has issued an order. Self-sufficient India. ”
The order will be effective from October 1, 2020.
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