Payana: Procurement Policy
1. Introduction:
Payana is committed to ensuring transparent, efficient, and accountable procurement processes to
support its mission and operations. A good percentage of Payana’s budget is allocated for purchase
of materials for projects. It is imperative that:
Purchases are made on competitive/fair price basis at the most economical manner ensuring
value for money
Transparency and equitable approach are followed in the procurement process
Adequate documentation is maintained to evidence the above
This Procurement Policy outlines the procedures and guidelines for the acquisition of goods and
services by Payana. Keeping in view the nature of materials that Payana may normally require for
the projects and other activities, the following Policy and Procedure is introduced.
2. Procurement Thresholds:
2.1. Purchases Below ₹ 2,000 (Rupees two thousand only):
- Project specific purchases of value less than ₹ 2,000 may be made across the counter or through
online platforms by any authorized staff member without the need for prior approval. An employee
can make cash purchases across the counter to meet urgent requirements up to a limit of ₹ 2,000/-
at any one time. Such purchases can be made by drawing cash from the office or through own funds.
This includes on-line purchases. On completion of the purchase, necessary bills should be submitted
to Accounts Department and balance cash returned or submitted for reimbursement in case of
purchase through own funds. All such bills (irrespective of value) shall be approved by the respective
Program Managers or Project Directors (as the case may be) indicating the project to which
expenditure is to be debited.
2.2. Purchases Between ₹ 2,000 and ₹ 10,000:
- Project specific purchases with a value between ₹ 2,000 and ₹ 10,000 may be made by a Project
Manager or Project Director (as the case maybe) subject to prior approval by the Executive Director.
No competitive bidding or quotations shall be required for such purchases. The Project Manager or
Project Director (as the case maybe) shall raise a purchase requisition on the prescribed format,
indicating nomenclature of item, quantity required, estimated cost, suggested source of supply etc.
The requisition is to be approved by Program Manager or Project Director (as the case maybe) and
authorized by the Executive Director confirming availability of funds under the project/line item.
2.3. Purchases Above ₹ 10,000
- Purchases with a value above ₹ 10,000 is mandatory to be recommended by a Purchase Committee
- The requisition (as above) duly completed should be forwarded by the User to the Purchase
Committee who shall obtain a minimum of three competitive priced quotations (excluding in case of
proprietary items) and recommend the procurement to the Executive Director/ Project Director/
Project Head or General Secretary (as the case maybe).
3. Procurement Process:
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3.1. Requisition:
- Any staff member requiring goods or services shall submit a requisition detailing the specifications,
quantity, estimated cost, and justification for the purchase.
- Requisitions shall be raised using the prescribed format and forwarded to the designated authority
for approval.
3.2. Approval:
- Requisitions for purchases between ₹ 2,000 and ₹ 10,000 shall be approved by the Executive
Director based on the necessity and availability of funds.
- Requisitions for purchases exceeding ₹ 10,000 shall be reviewed and approved by the Purchase
Committee in accordance with established criteria.
3.3. Procurement:
- Upon approval (for items between ₹2,000 to ₹10,000), the authorized staff member shall proceed
with the procurement process, ensuring compliance with relevant procurement policies, procedures,
and legal requirements. Purchase Orders shall be placed wherever required by the Accountant or
any other staff authorized for this purpose.
- Competitive bidding or quotations shall be mandatory and solicited by the Purchase Committee for
all purchases above an invoice value of ₹10,000.
- Wherever quotations cannot be obtained for inadvertent reasons (incomparable items, proprietary
items or exclusive items), the Purchase Committee shall make detailed notes of the issue and
proceed to recommend the same for purchase directly in the absence of competitive quotes.
3.4. Execution:
- Goods or services shall be procured from reputable vendors or suppliers based on the best value
for money, quality, and delivery timelines.
- Contracts or purchase orders shall be executed, detailing the terms and conditions of the
procurement, including payment terms, warranties, and delivery schedules. The Accountant or any
other staff so authorized for this purpose shall be responsible to issue the Purchase Orders.
3.5. Purchase Committee Constitution, Role and Responsibilities
- The Purchase Committee shall consist of not less than three members including the Accounts
Officer/ CFO and any two staff irrespective of branch office or other locations
- The Executive Director of Payana shall not be a Purchase Committee member.
- The Purchase Committee shall conduct meetings either in person or online and record the minutes
of the meetings for future reference and audit purposes.
- The Purchase Committee shall review the requisition, assess the necessity and feasibility of the
purchase, and approve or reject the request based on predetermined criteria
- The Purchase Committee shall solely be responsible to conduct price negotiations with the lowest
quoted vendor
- The power of the Purchase Committee is limited to making recommendations for purchase to the
Executive Director.
4. Executive Director Authorization and Powers:
- The Executive Director shall at their discretion authorize all purchases of value above ₹2,000
(invoice value), ensuring alignment with organizational objectives, budgetary constraints, and
compliance with applicable policies and regulations
- The Executive Director is vested with the power to accept or veto the recommendation without
assigning any reasons thereof
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- However, the Executive Director shall under no circumstances supersede the recommendation of
the Purchase Committee
- All purchases made by the Executive Director of value above ₹10,000 shall be approved by the
Board of Directors of Payana
5. Purchase Orders:
Purchase Orders (POs) shall be issued after obtaining sanction of the Executive Director by the
Accounts Officer. However, with respect to project related items, the concerned Program Manager
shall be mandatorily informed prior to release of the PO. Delivery Challans/ Invoices must be
approved by User(s), as the case may be, signifying correctness of the items and acceptance of the
same. Wherever in-house expertise is not available, the Purchase Committee may make use of
external support for technical inputs and advise and the same may be recorded in the meeting
minutes. IT items may be referred to outside consultants for meeting expectations and
specifications. All purchased assets shall be included in the asset list and assigned an asset tag.
Assets shall be capitalized as per the Finance Policy. Following this, bills for payment shall be
forwarded to Accounts along with the case file for audit and payment action. Payment of bills should
be processed by the Accounts department only after all certification is complete.
6. Contingency Purchases:
Competitive bids are not mandatory in case of contingency purchases such as housekeeping
requirements, stationery, computer consumables and other hospitality items. Such items may be
obtained from reputed vendors or authorized dealers (in the case of computer consumables)
without formal tendering action. However, a roster of at least two or three vendors may be
maintained for such purchases and their rates periodically counter checked with market prices. All
such purchases shall be approved by the Program Manager/ Project Director as the case maybe.
7. Verbal orders:
Under very exceptional and unavoidable circumstances verbal orders may be placed with known,
reputed vendors with due concurrence of the Executive Director and Accounts Officer (for
confirming funds availability). The value of such orders will not exceed ₹25,000/- and the same
should be regularized through a covering purchase order.
8. Books/Reports:
Books/reports/newspapers and magazines may be procured with sanction of concerned Program
Managers/ Project Officers. Cash purchase of books up to a limit of ₹ 2,000/- (Rupees two thousand
only) may be allowed occasionally. However all purchases including subscriptions are subject to prior
sanction by the Project Director. Subscriptions to journals may be made with the sanction of PD.
The above procedure will also apply for all purchase of digital media on maps and data.
9. Advance Payments:
Advance payments may be authorized only against matching bank guarantee. In exceptional cases,
ED may authorize advance payments without a bank guarantee.
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10. Amendments to Purchase Orders:
The same authority that approved the original Purchase shall approve the amendment to the PO.
Amendments to PO shall be processed as required and will be reflected on the Purchase Order.
11. Record Keeping and Reporting:
- Records of all procurement activities, including requisitions, approvals, purchase orders, contracts,
and invoices, shall be maintained in a centralized procurement register
- Regular reporting on procurement activities shall be provided to the Project Directors, Board of
Directors, Internal Auditors or other relevant oversight bodies as required
12. Compliance and Monitoring:
- Compliance with this Procurement Policy shall be monitored and periodically reviewed to ensure
adherence to established procedures, accountability, and transparency.
- Any deviations or non-compliance with the policy shall be promptly investigated and appropriate
corrective actions taken.
13. Review and Amendment:
- This Procurement Policy shall be subject to periodic review and may be amended as necessary to
reflect changes in organizational needs, regulatory requirements, inflationary influences or best
practices in procurement management.
14. Conclusion:
By adhering to this Procurement Policy, Payana aims to streamline its procurement processes,
promote accountability and transparency, and ensure the efficient utilization of resources for the
fulfillment of its mission and objectives.
