Do you require Advance Payment Guarantee to acquire Advance Payments? We provide the required Bank Guarantee on behalf of your company from our bank account; this enables you to get the advance payments from your counter party.
To get BG MT760, follow the simple steps given below:
Advance Payment Guarantees acts as an assurance to secure the advance payment made by the developer or buyer to the contractor or seller. It is issued by a bank on behalf of their clients; in favor of their counter parties. This bond is also called a Payment Bond.
When the developer and the contractor sign the building contract; the contractor may require some sort of advance payments to start the work; also, to speed up the process on the specific project.
When the contractor contacts the project owner to get the required advance payments; they demand a guarantee from the contractor; which assures the commitment in completing the task as agreed in the contract.
The value of the bond depends on the advance payment made to the contractor. Once issued, the value of the bond will reduce concurrently; i.e. depends on the work done by the contractor. Further, it keeps on reducing; until the completion of the project as agreed in the contract.
Also, the BG MT760 is issued as payable on first demand; i.e. if the project owner calls the bond in written format; then the advance payment will be paid in full without any preconditions.
As like, Payment Bond for construction, Advance Bank Guarantee also being used in imports and exports. When the buyer and the seller signs the import contract; to mobilize the supply of goods, the seller may ask for a certain percentage of trade value as advance payments from the buyer. Before issuing the payments; the buyer demands the seller to provide a Bank Guarantee; mainly to secure themselves from any financial risk against any default by the seller. By issuing this MT760, the contractor receives the required advance payments; on the other hand, the buyer gets peace of mind that their payments are secure.
As we discussed, Advance Payment Bond plays a vital role in trade deals and construction contracts. Usually, when it comes to availing Payment Bond; contractors & suppliers contact their banks to get BG MT760 on their behalf. And to issue the MT760 on their behalf, the bank will demand 100% of the bond value as cash margin or deposit. In case, if you don’t have enough cash funds to provide as a cash deposit; then the bank will decline your BG request. And in turn, you can’t able to get the advance payments from your counter party.
As the International Bank Guarantee Providers in Dubai, we understand the cash flow issues faced by traders and contractors. So we support our clients by providing the required bond from our Bank Account without availing cash margin or collateral. Submit your Bank Guarantee requirements to us; and get MT760 in less than 48hrs.
For contractors, a steady cash flow is very important to speed up the project without any hassle; also, to provide the positive completion of a project. Lack of cash flow or delay in payment will affect the work progress; also, end up with not paying for workers and material suppliers. All these will have a drastic impact on the progress of the project.
That’s why contractors often demand upfront payment from project owners; before starting the work on the project. Even, Advance Payments help contractors to mobilize their work; on the other hand, project owners don’t have any assurance that whether the contractor will complete the work as per the agreed contract. That’s the reason why project owners often demand a Bank Guarantee from contractors before issuing Payments.
Having MT760 in hand assures the project owners that the contractors will fulfill the set of work as agreed without any default. And in case, if they fail to do so, then the project owner can claim the bond against the default of the contractor; also, get the refund of the advance payment made.
Overall, the main purpose of this Down payment Guarantee is to – increase the cash flow for contractors to meet the initial costs of the project; also, to speed up the progress of work.
The parties involved in the issuance of the MT760 includes:-
Applicant – The contractor or seller who requests the MT760 from the bank; in favor of the project owner or buyer.
Beneficiary – The developer or buyer who receives the MT760 in their favor.
Bank – The bank that assures the payment, in case, if the contractor or the seller defaults.
Whether you’re a contractor or a supplier, you can avail Bank Guarantee from us! There is no need to have your own bank facilities available in European Banks; to get MT760 on your company’s behalf.
We can extend our bank facilities available in rated banks; to provide the MT760 on your behalf to avail advance payments from your project owners and buyers.
With a deal conclusion time of 48 working hrs, we assure you that you will receive the guarantee at the right time. Further, we do not strain your cash liquidity to issue the BG.