Tender Money (also called Earnest Money Deposit or EMD) is a sum of money paid by a bidder while submitting a tender to show seriousness and commitment to the contract.
Tender Money is required in government and private contract bidding processes. It acts as a security deposit to ensure that bidders do not withdraw or change their offer after submission.
If the bidder wins the contract, the amount is either adjusted against the security deposit or refunded. If the bidder withdraws or fails to honor the contract, the tender money may be forfeited.
"A contractor submits a bid for a project and deposits ₹50,000 as tender money. If selected, it may be adjusted or refunded; if not, it is returned."