Tenders 2.0 – A Stake-Based Blockchain Solution for Tender Procurement System

Abstract

Tendering is a procedure taken up by organizations for procurement of goods and services. Tender process when followed properly allows bids from multiple vendors and thereby facilitates healthy competition and fair outcome. Almost all the countries follow this process in standard and similar fashion. Lack of transparency in the tendering process and assignment of contracts to preferred agencies (rather than to a deserving bidder) has led to unwise use of money and the spirit of speculation. Blockchain is a decentralized ledger that makes records immutable, facilitates the secure exchange of digital currency, and performs deals and transactions. Each member of the blockchain network has access to the latest copy of encrypted ledger so that they can validate a new transaction. In this paper, we propose a blockchain-based tender procurement system with secure, fair, and reliable bidding architecture that can transparently manage the whole bidding process and perform an unbiased evaluation of bids. This system allows citizens to evaluate the process with a single click through an auditing application, which accounts for some stake to be put in the system against a false claim of task completion and thus actively help in making the democratic system stronger.