Protect lenders from borrower default
Repayment Guarantee
A Repayment Guarantee protects lenders by ensuring they receive repayment if a borrower defaults on a loan. It acts as a financial safety net, covering both principal and interest as outlined in the loan agreement. This assurance makes lenders more willing to extend credit, particularly in higher-risk scenarios. Borrowers benefit as well, as it can improve their chances of securing financing by reducing perceived lender risk.
Key Benefits
Lender protection against default
Principal and interest coverage
Improved credit access for borrowers
Risk reduction for financial institutions
Loan approval facilitation
Financial security
Credit enhancement
Common Use Cases
- • Corporate loans
- • Project financing
- • Trade finance
- • Working capital loans
How It Works
Step 1: Loan Agreement
Borrower secures repayment guarantee for loan
Step 2: Repayment Period
Guarantee covers loan duration
Step 3: Default Protection
Lender compensated if borrower defaults
Target Audience
Banks, financial institutions, borrowers, corporate entities