Terms & Glossaries of Shipping and Trading
A bank guarantee is a type of financial backstop offered by a lending institution. The bank guarantee means that the lender will ensure that the liabilities of a debtor will be met. In other words, if the debtor fails to settle a debt, the bank will cover it. It is issued by a bank to a carrier to be used in lieu of lost or misplaced original negotiable bill of lading.
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