Advance Payment Guarantee
Advance Payment Guarantee or Advance Payment Bond is an instrument issued by a Bank on behalf of its customer to secure upfront payments to them by third parties for jobs awarded to, but not yet executed by, the contractor or customer.
An Advance Payment Guarantee is issued to secure the release of payment for mobilization of a project or contract. It is intended to bind the supplier [the bank’s customer] to use the advance payment for the purpose stated in the contract between the customer and the Principal.
The guarantee is payable on demand and may contain optional provision for the value of the guarantee to reduce with interim payments of certificates made under the contract. The advance payment guarantee should only become effective and valid once the advance payment has been received.
Requirements To Get An Advance Payment Guarantee
We require the following information from the contractor [awardee]:
- Company Name
- Postal Address
- Mobile Number
- Procuring Entity [Employer] Name
- Procuring Entity’s Address
- Performance Bond Amount
- Award Letter from Employer
- Bank Statements [up to 6 months]
- Portfolio of previously completed contracts/jobs
- Tender Description [Title]
- APG Validity [Period]