Types of Performance Guarantees: Merchant Credit and Guarantee Corporation Ltd

Merchantcreditcorp18 Sep, 2021Business

Performance Guarantees are of two types on demand and conditional. For on-demand guarantees, the bank has to make the payment, whenever it is demanded. Conditional guarantees are paid only after the occurrence of any unexpected event. The key benefits of Performance Guarantees for contractors or sellers are it enhances liquidity, improves the ability to bid more, and opens more business opportunities by providing financial strength and guaranteeing a positive outcome.