Introduction

Payment guarantee is issued to guarantee the applicant’s payment obligation in an underlying contract of sales or purchase of goods, services, rights, etc.

Product Features

1. Mitigate mutual distrust of parties involved in contract.

2. Guarantees payment in a contract.

3. Reduce initial cash outlay in a contract if cash deposit is otherwise required.

4. Improves liquidity and increase the contractor or supplier’s market competitiveness.

5. Commonly required in commercial contracts eg. sales and purchase contracts of goods, services, rights, technology know-how or in construction projects, etc.

Application requirements

1. Maintain current account with our bank.

2. Companies must posses the proficiency in performance under the contract.

3. A credit facility or at least 100% cash margin or deposits must be provided (must be pre-arranged with the bank).

4. The format of the bank guarantee that is to be issued must be acceptable to the bank

Application Procedures

1. Applicant submits bank guarantee request together with the documentary evidence showing the need for the Payment guarantee eg the commercial contract.

2. Applicant remits the cash margin or deposits into the Bank and submits the required documents.

3. The bank evaluates customer and transaction information.

4. The bank reviews the bank guarantee request, the format of the guarantee and checks the security documentation.

5. The bank guarantee is issued.