Bank guarantee

Bank Guarantee is a kind of guarantee from a lending organization. The bank guarantee signifies a lending institution ensures that the liabilities of a debtor is going to be met. In other words, if the debtor is unsuccessful to settle a debt, the bank will cover it. A bank guarantee allows the customer, or debtor, to acquire goods, purchase equipment or draw down a loan.[1] A bank guarantee is a promise from a bank or other lending institution that if a particular borrower defaults on a loan, the bank will cover the loss. A bank guarantee is not the same as a letter of credit.[2]

ReferencesEdit

  1. ^ What Is a Bank Guarantee? investopedia.com
  2. ^ Bank Guarantee investinganswers.com