Bank guarantee
This query is : Resolved
GANESH DURAI IYER
(Querist)
05 May 2010
What is a Bank Guarantee? Why do companies take a Bank Guarantee?
Rahul Gupta
(Expert)
05 May 2010
A Bank Guarantee is isuued by a Bank ensuring that the liabilities of a debtor will be met. In other words, if the debtor fails to settle a debt, the bank will cover it. The bank chages some commission for issuing Bank Guarantee.
A bank guarantee enables the customer (debtor) to acquire goods, buy equipment, or draw down loans, and thereby expand business activity.
A bank guarantee enables the customer (debtor) to acquire goods, buy equipment, or draw down loans, and thereby expand business activity.
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