• bank guarantee

    BANK GUARANTEES

    Definition

    Bank Guarantee is a contract between a bank as guarantor and a beneficiary in which the bank commits itself to pay a certain sum under certain, specified conditions.

    A Bank Guarantee is an instrument issued by the bank in which the Bank agrees to pay a specific amount of money to the beneficiary of the BG, in the event of non-performance of underlying commitment by the applicant of the BG.

    Thus, a demand guarantee is one in which the bank agrees to pay against the simple written demand of the beneficiary.

     

    We shall study about this article further, in detail, in our next post.

     

    Keep reading!!

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