Banks LC & BG
Guarantee Provided By The Bank
It is ideally never to be used, as it is the last resort of payment. It primarily works as a safety mechanism for beneficiaries to eliminate any risks associated with the trade. This is issued on behalf of the client. Considering the circumstances under which the bank guarantee is carried out, it is called ‘Payment of Last Resort’. The bank guarantee provides proof of the buyer’s credit quality. To complete this process, a short underwriting is carried out that ensures the quality of credit.
Application process for bank guarantee
- Before the application for a bank guarantee, several aspects are taken into consideration. The main factor is whether the amount being guaranteed is repayable. Following this, the documentation review is carried out in which the letter is provided to the business owner.
- After the bank guarantee provision, the business owner needs to pay a fee every year for it to remain active.
We at FIB, help you through the process of getting the bank guarantee without major disruptions and to gain financial security. - The standard fees lie between 1-10% of the bank guarantee value. In case, the business meets the contractual obligations before the due date, the bank guarantee can be ended.
- Since it works as an insurance mechanism, there can be a collateral requirement. This can include both cash and assets. The collateral to be provided highly depends on the risks and business strength.
Bank guarantee advisory services
- A bank guarantee (BG) is permission from a lending institution that specifies that the liabilities of a buyer will be set; it is the bank’s responsibility to cover due if the buyer cannot settle the amount due.
- Bank guarantees allow you and your organization to safely fund your demands during critical transactions and efficiently increase the probability of your investment. Put another way; a bank guarantee is an agreement between the bank and the debtor to pay the debtor’s liabilities if the debtor fails to do so.
- You can rest easy knowing that your money is safe and secure if you meet your contractual obligations.
Benefits of the Bank Guarantee
- Private trades in new nations are less risky.A lack of control by the private sector over the dangers.
Expands the market and raises investment opportunities. Enhances your company’s project supportability and productivity - Manufacturing, shipping, and performance issues that are not up to standard.
- We provide bank guarantee services quickly and without the need for complicated documents for our clients in Dubai, Abu Dhabi, Sharjah, Saudi Arabia, India, UK, and Bangladesh.
We provide the listed items below
- Performance guarantee
- Retention money Guarantee
- Payment Guarantee
- Facility Guarantee
- Maintenance Guarantee
- Customs Guarantee
- Shipping Guarantee
- A bank guarantee can allocate these risks and serve as a defnce for both parties to a transaction, providing insurance if the contract terms are not met by anybody involved in the transaction, with 100% cash-backed BGs and only ties with the world’s most prestigious financial institutions.
