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Bank guarantee

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Mantu Agarwal

Mantu Agarwal (Querist)

14 September 2011 Dear Expert,
What is Bank Guarantee and why is it issued?

Thanks,

deepak K Gujrati

deepak K Gujrati (Expert)

14 September 2011 Bank guarantee is generally issued by a party in favor of another party who is acting like sending goods,making payment and wants an assurance from other party for its performance.
For issuing BG one has to approach . The bank like any other credit facility completes the requirement and issue it. It is generally issued for 6 months.

CMA Gul S

CMA Gul S (Expert)

14 September 2011 A surety or guarantee, in finance, is a promise by one party (the guarantor) to assume responsibility for the debt obligation of a borrower if that borrower defaults. The person or company that provides this promise, is also known as a surety or guarantor.

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