Bank Guarantee

Other Services

Bank Guarantee

Financial guarantees issued with Board sanction, cash margin and legal review.

• Only financial guarantee should be issued for period not exceeding 10 years.
• Guarantee should not be allowed to the customers who do not enjoy credit facility bearing small amount guarantees. The small amount guarantee will be on 100% Cash Margin.
• The guarantee shall be secured on 50% cash margin and 50% movable / immovable security.
• The guarantee shall have restricted liability clause and guarantee draft letter shall be approved by legal advisor of the bank.
• The commission shall be levied as approved by the bank from time to time.
• Branches shall keep a separate Guarantee Issued Register.
• Once the guarantee period expires, a notice / letter shall be issued to the beneficiary requesting him to return the original guarantee and customer may be persuaded to get back the original guarantee.
• No guarantee shall be issued without the sanction of Board of the Bank.
• If any claim arises, it should be referred to H.O. and only after obtaining permission the guarantee claim amount should be settled.
• The applicant should be asked to clear the claim amount without loss of time. If not cleared, the usual steps for recovery of loan should be initiated.