Issuing various kinds of Rial and foreign exchange letters of guarantee
Letter of guarantee is a contract based on which the issuer bank of this guarantee, undertakes the debt or liability of a real or legal entity towards a beneficiary in a determined deadline.
Various kinds of Letters of guarantee:
- Tender guarantee (Bid Bond): this type of guarantee is issued to prevent the applicant from refusing to accept the award contract and guarantees the acceptance of it by the bidder.
- Performance guarantee: these guarantees are designed to ensure that the goods are delivered, or services are provided in accordance with the terms mentioned in the contract and at the due time whether the contract is properly performed or not.
- Advance payment guarantee: this kind of guarantee payment is issued to insure the beneficiary that an advance payment is properly used in accordance with the terms of contract concluded between the two parts.
- Retention guarantee: The beneficiary pays the amount of a project after receiving the statements. In some cases, a percentage of each presented statement will be blocked by the beneficiary as a guarantee and assurance until the certain delivery is performed. So, in case of necessity for receiving blocked amounts, just by presenting the Retention guarantee to the beneficiary these amounts will be released.
- Payment guarantee: Under some circumstances when opening L.C or using other banking payment means is not possible, by receiving Payment guarantee with the equal value of goods, the seller sends the goods and requests the bank for payment according to the agreed deadline mentioned in the contract and can receive the amount of their goods.
Payment guarantee includes four kinds as follows:
1. Custom duties letters of guarantee which includes the following kinds:
18.104.22.168 Custom duties letters of guarantee (in case the importers of goods cant afford to pay the custom duties and interest of the imported goods in cash, they can apply this letter of guarantee.
22.214.171.124 Temporary cargo clearance letter of guarantee ( this letter of guarantee is issued for machineries which are imported for marketing, displaying in commercial exhibitions or copying them for domestic production and similar reasons in a short period of time and are then moved out of the country.
126.96.36.199 Goods transit Letters of Guarantee (This kind of guarantee is issued for the custom duties of goods and machineries which are imported from one border of the country and exported from another border).
188.8.131.52 Duty-free transit pass Letters of Guarantee (This kind of guarantee concerns the custom duties of goods and machineries which are not possible to keep in the entrance warehouses of the country; therefore, they must be transferred to the other reliable warehouses of the customs house.
2.5.2 Military service Letters of Guarantee.
3.5.2 Justice administration Letters of Guarantee.
4.5.2 Other Letters of Guarantee.
2- Issuing Rial and Foreign exchange Letters of Credit
Letters of credit is a way and kind of payment guarantee based on which the bank guarantees the payment of a certain amount of money to the seller of goods or services on condition that the determined shipment documents of transferring goods or performing services are presented by the seller in the deadline and based on the mentioned conditions in the contract.
In this regard, issuing Rial Letters of Guarantee is done in all branches and foreign currency Letters of credit in selected branches of shahr bank.
The least required documents presenting opening Internal Letters of Guarantee:
- Pro forma Invoice or a valid contract of selling goods.
- Providing services, a valid insurance policy to the banks benefit.
- Pre-shipment inspection and also the commitment letter of the deals stability.
- The least required documents when dealing the inventory deal (commercial inventory of selling goods or as the condition of service performance which has been approved by the employers or their legal agent).
- Shipment document (based on the case, bill of lading, waybill, delivery and transformation of goods, the sellers warehouse draft or warehouse bill and the goods inspection license.