Guarantees & sureties (Bonding)
Extra credit room with your banker
Having a guarantee or surety from a financial institution enables you to give your trading partners the assurance that you will comply with your contractual obligations. If you do not abide by your obligations, the financial institution will then provide compensation to the trading partners affected.
Guarantees and sureties are viewed as a widely accepted technique between trading partners in regular economy. They are also often required by government departments.
We work with 2 major groups of guarantees: contractual and statutory.
With contractual guarantees, your customers ask you for a surety or bond to ensure that you will comply with all of your obligations. If you do not abide by your contractual commitments, you are then required to compensate your customers.
With statutory guarantees, a financial institution assists you with covering your legal obligations at home and abroad with regard to the customs, tax and environmental authorities, etc.
Why take out a guarantee via a credit insurer instead of your bank?
Until a few years ago, the banks in Belgium had a monopoly regarding the issue of guarantees and bonds. This was not the case in other countries. The market in Belgium is also in the process of changing. More and more credit insurers are now providing guarantees in addition to the banks.
The benefits are clear:
- most insurers have an AA rating, which means they are highly creditworthy;
- placing all or part of your sureties with a credit insurer enables you to free up room on your bank credit facilities. As a result, you will be able to put the funds from your bank to good use for financing your business activities.
CRiON will help you to select the right credit insurer by offering expert, personal advice. CRiON’s specialists have extensive knowledge of all the possible guarantee benefits.
Want more information?
Telephone us to make an appointment by calling: +32 (0)9 244 62 62.
Or send an e-mail to: firstname.lastname@example.org.