While entering into a large-scale business-transaction or carrying out a high-value project, a company may be required to submit a Bank Guarantee (BG). Further in export trade, bank guarantees are required in connection with contracts for sale of capital goods, setting up of turnkey projects and construction projects abroad as also for overseas service contracts. These are required at various stages right from pre-bid stage to completion of project. Contents What is Bank Guarantee? Type of bank guarantee Bank Performance Guarantee: Financial Guarantee Deferred Payment Guarantee Foreign Bank Guarantee Features of a Bank Guarantee Advantages of Bank Guarantee Bank guarantee charges What is the period of bank guarantee? Bank guarantee format What is Bank Guarantee? Bank Guarantee acts as an undertaking assuring the beneficiary that the bank would pay the specified amount, in case of its applicant’s default in delivering the financial or performance obligation as mentioned in