A written guarantee by SMEP Microfinance Bank to the employer/ procuring entity that has advertised for a service to execute a contract and ensure that upon winning the bid/tender, they shall accept the same.
These instruments are irrevocable undertakings by SMEP Microfinance Bank on behalf of contractors / suppliers to guarantee satisfactory performance as per the contractual obligations.
Where the procuring entity agrees to make an advance payment to a supplier or contractor to trigger project mobilization, an advance payment guarantee may be required to secure the procuring entity against default by the advance payment beneficiary. This guarantees is conditional i.e. it only becomes effective upon receipt of the guaranteed amount by the guarantor i.e. the guaranteeing financing institution (SMEP Microfinance Bank).