Performance Guarantees (Performance Bonds)
Owners and lenders want proof you will deliver to spec, on time, and within the contract rules. We arrange Performance Guarantees
that satisfy beneficiary wording, cover claims up to an agreed limit, and stay valid through completion and handover. Each file is underwritten on technical and financial capacity, with tight attention to claim language and governing law.
Outcome:
A bank-acceptable performance bond naming the correct beneficiary, aligned to your contract milestones, with clear validity and claim mechanics.
Who Uses Performance Guarantees
EPC contractors
Required to post security at contract award and keep it through handover.
Developers and sponsors
Needed to reach financial close or drawdown under loan agreements.
Consortia and JVs
Projects with joint liability or split scope requiring precise wording.
O&M providers
Frameworks that need ongoing performance cover across sites.
Terms and Pricing
| Item |
Details |
| Coverage amount |
Typically 5%–20% of contract value (per contract requirements) |
| Validity |
Through completion and acceptance. Extensions available. Optional defects period cover. |
| Upfront premium |
3%–7% of guaranteed amount, risk-based (minimum fee applies) |
| Annual or extension fee |
2%–3% per annum, pro-rated for extensions beyond original validity |
| Security / conditions |
May require cash margin, standby support, covenants, or collateral (case by case) |
Underwriting Focus
- Contract review: scope, milestones, LDs, testing, acceptance, and claim language
- Technical capacity: track record, key personnel, equipment, subcontract plan
- Financial strength: balance sheet support, cash flow, hedging on major inputs
- Compliance: KYC, UBOs, sanctions, permits, and jurisdiction checks
- Interface risk: suppliers, grid or utility connections, and third-party dependencies
Process and Timing
1) Submit File
Contract draft or signed agreement, schedule, bond format, and KYC.
2) Risk Review
Capacity and financial screening. Clarify claim conditions and expiry.
3) Terms
Pricing, conditions, and wording aligned with beneficiary requirements.
4) Issuance
Bond issued and registered. Extensions processed on request.
Reasons We Decline
- LDs or claim wording that create open-ended exposure without caps
- No path to completion funding or missing critical permits
- Balance sheet too thin for contract size and risk
- Anonymous UBOs or incomplete compliance pack
- Beneficiary refuses standard legal protections or governing law clarity
Documents Required
| Document |
Purpose |
| Contract or EPC agreement with schedule |
Defines scope, milestones, and acceptance rules |
| Draft performance bond format |
Aligns wording, expiry, and claim steps |
| Company KYC, UBOs, and permits |
Compliance and eligibility |
| Financials and project budget |
Capacity to deliver and absorb delays |
| Supplier and subcontract plan |
Interface and timeline control |
Apply for a Performance Guarantee
Send your contract, schedule, and bond format. We will review eligibility and return pricing and terms.
Start the Process
All guarantees are subject to underwriting, legal review, and approval. We do not issue unconditional guarantees. Extensions and defects liability coverage are available on request and may incur additional fees. Governing law and jurisdiction must be acceptable to the issuer.