Bank Guarantee for Corporates

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Bank Guarantee for Corporates

Bank Guarantee for Corporates

Bank guarantee (BG) is used to strengthen and/or secure an obligation under a commercial contract. Customers can apply to the Bank to issue BG in favour of a Beneficiary. After examining and approving the application, the bank executes an agreement with the customer with the required terms and conditions. The bank will then issue the guarantee. 

  • Features
  • Eligibility
  • Security
  • Financial Guarantees, Performance Guarantees and Deffered Payment Guarantees are provided to eligible customers
  • Financial Guarantee is in lieu of monetary obligations
  • Performance guarantee is in respect of performance of a contract
  • Deferred payment guarantee is provided when the guarantee is backed by adequate tangible security or by counter guarantees of Central or State Governments, public sector financial institutions or other companies
  • All Corporates having turnover of Rs.500 Crores and above.
  • Guarantees issued on behalf of Joint stock companies should be supported by appropriate resolution of the Board of the directors of the company.
Primary
  • Hypothecation / extension of Hypothecation charge over the underlying current assets.
 
Collateral
  • Second charge on fixed assets and or hypothecation of machinery / assets.
  • Additional tangible security such as immovable properties / bank deposits etc. 
Others
  • Counter Guarantee
  • Personal guarantee of proprietors / partners / promoters
  • Corporate guarantee 

Also Know About

Also Know About

Letter of Credit (LC)
Bill Discounting
Post Shipment Limit(PSL)
Merchant Banking Services
Project Finance
IFSC Banking Unit (IBU)