Advance Payment Guarantee
Do you require an Advance Payment Guarantee to acquire Advance Payments? Silver Stone Consultancy provides the required Bank Guarantee on behalf of your company from our bank account, without blocking your cash funds. To get BG MT760, simply follow the steps below:
Submission of Documentation: The client submits the Pro forma Invoice or SPA related to their trade deal for the BG request.
Request Review: We will review the request and advise the client about the approval if their MT760 request meets our terms.
Service Agreement and Payment: We will ask the client to sign a service agreement and pay the service charges. Once done, we will proceed with their request.
Structuring the MT760: We will structure their MT760 with our bank by blocking our bank limit and send the MT760 draft for their approval. Additionally, we will ask them to pay the issuance fee and submit other required documents.
Issuance of Guarantee: After receiving the necessary documents and fees, we will instruct our bank to issue the Advance Payment Bond from our bank account. This will be issued on behalf of our client and in favor of the counterparty via SWIFT MT760.
What is an Advance Payment Guarantee?
An Advance Payment Guarantee (also known as a Payment Bond) acts as an assurance to secure the advance payment made by the project owner or buyer towards the contractor or seller. Issued by a bank on behalf of their clients, this bond secures the advance payment and ensures that the contractor or seller will meet their obligations as agreed.
In construction or other project-based agreements, when the project owner and contractor sign the building contract, the contractor may require an advance payment to kickstart the project and speed up the work. The project owner, in turn, may demand an MT760 Guarantee from the contractor to secure the advance payment and assure their commitment to completing the task as per the contract.
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Importance of Down Payment Guarantee in Construction
For contractors, a steady cash flow is essential to accelerate project progress without any delays. Lack of cash flow or payment delays can disrupt the work, leading to unaddressed payments for workers and suppliers. This can severely impact the completion and timeline of the project.
That’s why contractors often require upfront payments from project owners before starting the work. While Advance Payments help contractors mobilize the project, project owners face uncertainty about whether the contractor will complete the work as per the contract. To mitigate this risk, project owners commonly demand a Bank Guarantee before issuing payments.
Having an MT760 in place assures project owners that the contractor will fulfill their obligations as agreed. In case the contractor defaults, the project owner can claim the bond and recover the advance payment made.
The main objective of this payment bond is to increase cash flow for contractors, enabling them to cover initial project costs, and to speed up project progress.
Parties Involved in Bank Guarantee
The parties involved in the issuance of the MT760 include:
Applicant – The contractor or seller who requests the MT760 from the bank in favor of the project owner or buyer.
Beneficiary – The project owner or buyer who receives the MT760 in their favor.
Bank – The bank that guarantees the payment if the contractor or seller defaults.
How Do I Get a Payment Guarantee?
As previously discussed, the Advance Payment Bond plays a crucial role in trade deals and construction contracts. Typically, contractors and sellers contact their banks to obtain a BG MT760. However, banks usually require 100% of the bond value as a cash margin or deposit. If you do not have enough cash funds to provide the necessary deposit, the bank may decline your request.
As Silver Stone Consultancy, we understand the challenges clients face when trying to secure a BG MT760. That’s why we’re here to support you by facilitating the required Payment Bond through our reputable international bank partners in Europe. There’s no need to pledge a cash margin or collateral to obtain an APG MT760 through us!
Submit your Bank Guarantee requirements to us and receive your MT760 in less than 48 hours.
Avail Advance Bank Guarantee from Silver Stone Consultancy!
Whether you are a contractor or a seller, you can obtain an Advance Payment Guarantee from Silver Stone Consultancy! There’s no need to have your own facilities available to get an MT760 on your company’s behalf. We can leverage our available bank facilities with rated banks to provide the MT760 on your behalf, in favor of your counterparty.
With a deal conclusion time of 48 working hours, we guarantee that you will receive your MT760 Guarantee on time. Plus, we don’t require you to strain your cash liquidity or working funds to issue the BG.