A financial product under which the Bank makes a written, irrevocable commitment, at the request of a customer acting as applicant, to pay a specified amount to a beneficiary if obligations undertaken are not fulfilled.
A financial product under which the Bank makes a written, irrevocable commitment, at the request of a customer acting as applicant, to pay a specified amount to a beneficiary if obligations undertaken are not fulfilled.
Benefits
Provides assurance that guaranteed payments will be made
An effective instrument for securing various obligations
Demonstrates business customers' ability to fulfil their contractual obligations
Every stage of a transaction can be protected by a bank guarantee
Opportunity to secure better terms for a commercial transaction
An easily accessible bank product for trade finance
Payment
Participation in a tender
Proper performance of a contract
Advance payment
Customs purposes
Warranty obligations
Security for a loan
Backed by full cash cover or by security other than cash
Under a pre-agreed credit line
A bank guarantee is a written, irrevocable commitment by the Bank, at the request of a customer acting as applicant, to pay a specified amount to a beneficiary if obligations undertaken are not fulfilled.
It is not a standalone method of payment and is therefore often used in conjunction with a letter of credit and documentary collection.
An instrument for securing obligations under a commercial contract, rather than for making payment.
The Bank's obligation is irrevocable and unconditional and does not oblige the Bank to perform the underlying contract.
Purpose
Business customers who need this financial instrument to meet the requirements of their activities
