Bank Guarantee

A bank guarantee is a financial instrument provided by a bank to guarantee payment or fulfill obligations on behalf of a customer in the event of default or non-performance. Bank guarantees are often used to secure contracts, leases, or other business arrangements. They provide assurance to the counterparty that the financial obligations will be fulfilled, typically by the issuing bank acting as a guarantor. Bank guarantees can be in the form of performance guarantees, payment guarantees, or bidding bonds, depending on the specific requirements of the business transaction.