Glossary / Also known as

Letter of guarantee

Another name for Bank Guarantee.

Other names

What does letter of guarantee mean?

Letter of guarantee is another name for Bank Guarantee. Your bank's written promise to pay a third party if you can't deliver on a contract - widely used in tenders and trade.

The two names mean the same thing. You will see "letter of guarantee" in some ledgers, reports and contracts and "Bank Guarantee" in others. The full entry covers how it works, with examples.

Read the full definition of Bank Guarantee

Topics

Payments and banking

From the glossary

Related terms.

Payments and banking Bank Guarantee Your bank's written promise to pay a third party if you can't deliver on a contract - widely used in tenders and trade. Also called BG, letter of guarantee Trade and foreign exchange Letter of Credit (LC) A bank-backed guarantee that a seller will get paid - the backbone of international trade when buyer and seller don't know each other. Also called documentary credit, L/C Documents and contracts Due Diligence (DD) A comprehensive investigation and analysis of a business conducted before an investment, acquisition, or strategic partnership. Also called financial due diligence, legal due diligence Accounts payable Accounts Payable (AP) Money a business owes to its suppliers and vendors for goods or services received but not yet paid for. Also called trade payables, sundry creditors, payables Payments and banking ACH Transfer Batch-processed electronic bank transfers powering payroll, EMIs, and recurring payments across India. Also called Automated Clearing House transfer, ACH payment, ACH Payments and banking Beneficiary The person or entity on the receiving end of a payment, insurance claim, trust distribution, or trade finance instrument. Also called payee, beneficiary account holder

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