Bank Guarantee

  • A Bank Guarantee is an undertaking/promise of an issuing bank to pay to the beneficiary if the applicant fails to perform the duties and obligation as per the contract between applicant and beneficiary.
  • Bank generally acts as a guarantor for certain amount up to certain expiry date and promises to pay upon the request/claim of the beneficiary within the expiry date mentioning that applicant has failed to perform as per contract.

  • In general, 3 parties are involved in guarantee. Applicant, the Issuing Bank and the Beneficiary. 
  • Issuing Bank promises to pay to the beneficiary on behalf of applicant upon the failure of contractual obligations by the applicant. 

In general, bank guarantees are required for contract works (Thekka/Patta), bidding tenders, supply of goods, credit purchase, receive advance payments, to obtain license/ agencies such as manpower agency and forex transactions, custom/exim code purpose, court purpose, and international bidding/ counter guarantees.

Yes, we issue every type of guarantees as per you requirement. Most commonly used are: - Bid Bonds, Performance Bonds, Advance Payments, Counter Guarantees and Supplier Credit/Payment Guarantees.

One can provide 100% to 125% cash margin along with required documents in the bank to issue guarantee or avail line of credit facilities. Our dedicated team from Credit Department shall guide you to establish Guarantee Limit Facilities.

  • Our charges are published on website and you may also contact your nearest branch for details of charges.  
  • Charges are paid upfront at the time of issuance of LC.

Yes. But only for construction related companies (Nirma Byawasi/ Thekka Patta). Our dedicated Guarantee team shall guide you on this.

Yes. We do issue Joint Venture firm guarantees including international firm and local firm joint venture. Our dedicated Guarantee team shall guide you on this.

Following documents are required for guarantee issuance

  • Guarantee Application, Promissory Note ( Our Guarantee team shall guide you on this)
  • All the legal documents regarding firm registration 
  • Tax Clearance/ Tax payment certificate 
  • Board Minute mentioning to bear all the responsibilities of claim by our applicant ( in case of   third party guarantees and Joint Venture Agreement Guarantees)
  • Self-declaration of not having loan/ no overdue with other bank by the third  party ( if guarantee is issued  in third parties name)

  • You can submit guarantee application to the nearby branch. 
  • Upon the submission/fulfillment of required documents, we generally issue the guarantee within 2 hours.

No. Guarantees cannot be released prior to its expiry date. However, if the applicant can furnish the letter from the beneficiary itself or provide any document evidencing that the bid has been awarded to any other contracter/ bid has been cancelled/ or any other valid documents, we can release the bid guarantee.

  • Beneficiary can verify the bank guarantee through our website www. 
  • Upon filling the required guarantee reference number and guarantee amount, one can verify that guarantee has been issued by our bank.

  • Guarantees must be claimed within the working hour of expiry date.
  • Claim amount must not exceed the guarantee amount.

Guarantee can be claimed from any branch of our bank. Claim lodged shall be settled within 7 working days. Our Guarantee team shall guide you on this.

  • Claims must be settled within 7 working days from the date claim lodged by the beneficiary. If applicant is unable to arrange funds required for claim. Bank settles the claim booking the force loan in the client's name that has a highest rate of interest. 
  • Client shall be unable to do other transactions when Force Loan is booked and is encouraged to settle it immediately.

Claim amount can be made through Manager’s cheque and through account credit of the beneficiary.

Yes, Bank can issue Credit commitment. Upon request of the applicant with the approval from the concerned department, credit commitment can be issued.