Advantages of Bank guarantee
- Bank guarantee is more flexible and applicable to broad spectrum of businesses to protect the beneficiary against potential risks;
- It provides a type of monetary assurance to compensate a beneficiary in the event of non-compliance by the applicant with the terms of a contract;
- Enables both side of the business to expand and build trust with their partners in overseas;
- Bank guarantee works in favor of all parties due to its irrevocable nature, where without the consent of all parties involved, (applicant, beneficiary and the issuing bank) the guarantee can't be revoked and or amended;
- Potentially eliminates the advance payments to the beneficiary, which improves applicant’s working capital management;
- Less legal risk by adhering to ICC rules.