Highlights

Commercial Bank offers several guarantee products. You can choose the guarantee that fits best for your requirement. 

We offer;

• Bid Bonds.
• Performance Bonds.
• Advance Payment Guarantees.
• Retention Money Guarantees.
• Credit Facility Guarantees.
• Customs Duty Guarantees.
• Bonded Warehouse Guarantees.

Backed by the Bank’s reputation and stability

Bid bonds

Bid Bonds are issued for the purpose of guaranteeing the acceptance of a contract by the bidder if his bid is accepted and the contract awarded .

When bids are submitted for tenders, in most instances, the employer insists on a Bid Bond guarantee submitted along with the tender documents, with a view of safeguarding the interests of the employer.

Benefits

• Assists in securing contacts.
• Ensures the acceptance of a tender by a contractor/supplier in case the tender is awarded to him.
• Encourages contractors to make serious bid and up to their obligations.
• The beneficiary can claim under the Bid Bond in the event of bidder’s failure in accepting the tender, if awarded.
• Bid Bonds are normally issued for 1% to 5% of the contract value.

Performance bonds

Performance Bonds are issued for the purpose of guaranteeing the due performance of the contractor in respect of work under the contract awarded.

Benefits

• Guarantees proper  performance and completion of a contract and ensures confidence in transaction.
• Beneficiary can claim on failure of contractor to perform the work.
• Usually for 5% to 20% of the contract value

Advance payment guarantees

Advance Payment Bonds are issued for the purpose of guaranteeing the advance payments made in respect of contracts awarded

Benefits

• Widely used by traders and contractors.
• Facilitates import and export trade.
• Enables to obtain an advance payment for commencing the manufacturing of goods or performance as per the contract.
• Provide an opportunity to the buyer/employer to recover the advance payment made under the contract if the seller/contractor fail to fulfill its contractual obligations.
• Beneficiary  is entitled to claim under the guarantee in case of non-fulfillment of agreement.

Retention money guarantees

Facilitates in release of retention money of a contract, before completion of defect liability / warranty period.

In case if there are any defects in the work done / goods supplied, the employer / buyer has the authority to claim under the guarantee.

Credit facility guarantees

Facilitates sales on credit basis / release of credit facilities and protect the interest of the seller / lending institution in case of non-payment / non-settlement.

Mainly used in purchase of goods on credit basis.

Seller / lender can claim under the guarantee in failure to settle dues by the purchaser / borrower.

Secures the interest of lending institutions on granting of credit facilities.

Customs duty guarantees

Facilitate release of imported goods in lieu of payment of duty due to customs.

Goods will be released on submission of a Bank Guarantee.

Facilitate exporters who import goods for re export purpose without payment of custom duty.

Bonded warehouse guarantees

Facilitate storing of goods in Customs warehouse without payment of custom duty and release of goods when required.

Issued as security, covering a pre-determined duty component.

Generally these guarantees are renewed annually.

Terms & Conditions apply

Product information and terms & conditions are subject to change from time to time. Therefore, it is advisable to contact the branch nearest to you for the latest information and prevailing terms & conditions.