Bank Guarantee for Credit Enhancement
Bank Guarantee for Credit Enhancement
- * Corporates seeking better terms from lenders or suppliers
- * EPC and project sponsors needing bid, advance, or performance support
- * Traders and distributors requiring on-demand security for counterparties
- * Contract requires a demand guarantee under URDG 758
- * Beneficiary accepts MT760 from rated issuers, with or without confirmation
- * Collateral available beyond pure cash (receivables, inventory, deposits, guarantees)
- * Underwriting, SPV setup, bank accounts, and liquidity raise
- * Bank guarantee issuance via MT760 with approved wording
- * Optional advising or confirmation by an A rated bank
Credit enhancement use cases
| Scenario | Guarantee Role | Typical Rules |
|---|---|---|
| Supplier extends terms only against security | Payment Guarantee covering non-payment risk | URDG 758 |
| Bank or fund improves advance rate with support | Loan/Financial Guarantee securing principal or interest triggers | URDG 758 |
| Project requires bid, performance, or warranty support | Tender, Performance, or Warranty Guarantee for milestones | URDG 758 |
Bank guarantee types we arrange
| Type | Use case | Tenor | Rules |
|---|---|---|---|
| Payment Guarantee | Supplier terms and trade settlements | 3–18 months | URDG 758 |
| Performance Guarantee | Project delivery and milestone obligations | 6–36 months | URDG 758 |
| Advance Payment Guarantee | Secures buyer advances until delivery or commissioning | To milestone plan | URDG 758 |
| Tender/Bid Guarantee | Bid security for public or private tenders | Bid period + buffer | URDG 758 |
How the structure delivers credit enhancement
We map the contract, exposures, and collateral you can post. We set amount, tenor, reduction plan, and any confirmation. The term sheet lists security, pricing, and a dated timetable.
We form an SPV if needed, open operating and collection accounts, and document control agreements. Cash margin is minimized through pledged deposits, receivables, inventory, or guarantees acceptable to the issuer.
We align wording line by line, complete KYC and sanctions checks, select the issuing bank, and, where required, send MT799 after conditions are satisfied.
Issuer releases the guarantee via MT760. We track advising, confirmation, amendments, and reduction or cancellation at expiry.
Collateral and control options
- * Partial cash margin or pledged term deposit
- * Assigned receivables or offtake with controlled collections
- * Inventory under control agreements or warehouse receipts
- * Sponsor or parent guarantee for a defined slice
- * Escrow or account control with automated sweeps
- * Political or performance insurance where relevant
- * Issuance through top banks subject to approval
- * Optional confirmation by an A rated bank
- * URDG 758 wording mirrored line by line
Pricing and timeline
Time-based guarantee commission plus an arranger fee sized to collateral quality, tenor, and issuer feedback. Legal, KYC, courier, and government charges are pass through.
Cash margin can be reduced with strong collateral and enforceable controls. Final advance rate depends on counterparties and structure.
Underwriting and term sheet, SPV and accounts, documentation and KYC, then MT760 issuance. Dates are fixed at mandate and tracked to the day.
Bank guarantee FAQ
Often yes when lenders credit the guarantee as additional security. Pricing and limits remain lender decisions and depend on the structure.
Do you issue without any cash margin?Support is always required. We minimize cash by combining pledged deposits with receivables, inventory, guarantees, and account controls accepted by the issuer.
Is this a leased instrument?No. We do not arrange leased paper. Issuance is genuine and MT760 is operative for a real commercial purpose.
Top banks subject to credit and compliance. Names are disclosed at mandate with draft wording and conditions.
Can you add confirmation?Yes when the beneficiary requires it and capacity exists. Advising and confirmation can be arranged with an A rated bank.
What rules apply?URDG 758 governs on-demand guarantees unless local law wording is requested by the beneficiary.
Refund guarantee
If we accept your mandate and fail to deliver an issuer-approved draft guarantee text and a compliance-cleared issuance approval within the agreed timetable, we refund our arranger fee. Third party costs are excluded. Terms are stated in the mandate letter.
Request Bank Guarantee Terms For Credit Enhancement
Send the contract summary, required amount and tenor, beneficiary bank details, and your collateral plan. We reply with structure options, pricing, and a closing checklist.
Request A Loan/Bank GuaranteeFinancely acts as an arranger on a best efforts basis through regulated partners. Eligibility depends on KYC and AML, sanctions screening, legal and technical diligence, and approval by issuing banks. Nothing here is a commitment to issue or to lend.
Get Started With Us
Submit Your Deal & Receive a Proposal Within 1-3 Working Days
Submit your deal using our secure intake form, and receive a quote within 1-3 business days. Existing clients can connect with their relationship manager through our secure web portal.
All submissions are
promptly reviewed, and all communications are conducted through the intake form or the client portal for a seamless and secure process.
Thank you for considering working with us. A nominal fee of US$500 is required upon completion of each form. This fee covers the time and effort we invest in reviewing your submission and crafting a thorough proposal. We receive numerous inquiries and prioritize those that carry this fee, ensuring serious applicants receive prompt attention.
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