Credit guarantee

Credit guarantee is an alternative business in order preservation or protection of the risk of credit losses that may occur, where the risk of loss should be measured financially.

In terms, guarantee is an agreement in which a third party, for the benefit of creditors, bind themselves to meet the debtor's agreement, if the debtor does not fulfill the agreement.

The Parties in the Guarantee.
In the guarantee, the parties involved in it there are 3 (three) parties, namely:

Recipient of a guarantee, is Bank / Non-Bank Financial Institutions disbursed loans to secured and entitled to receive indemnity insurance (claims) from the guarantor if the Guarantee cannot meet credit obligations at maturity and cannot be extended or stalled credit before maturity;

Guaranteed is the party that received credits from the receiver to obtain warranty service guarantee from the Guarantor;

Guarantor is a company that conduct underwriting activities through the provision of services is guaranteed, the guarantor and guarantee recipients

The principle of the credit guarantee
Credit Guarantee have principles which include business feasibility, complementary credit (credit accesoir), substitute collateral, the takeover while the risk of bad debts, accounts receivable subrogation, third party involvement, and cooperation control. These principles must exist in the guarantee as an effort of prudence (Prudent) because the risk of a large guarantee. In addition, in the event of an error / default committed by Recipient guarantee, payment claim cannot be done but on the contrary, if in default carried out by guarantee, the Company Guarantor to pay the claim according to the agreed contract credit guarantee.

The Credit Guarantee Agreement
Credit Guarantee Agreement is an additional agreement (accesoir contract) agreement on the principal (main contract) between the Guarantee and Security Recipients, and thus in the business of bailing out the Certificate of Agreement there are 2 (two) types of agreements, namely:

a.   The agreement called Basic Agreement (Underlying Contract) the credit agreement was made between recipients with Guaranteed Warranty. This agreement is the basis of the emergence of an agreement granting guarantees to the Guaranteed Guarantee Certificate.

b.   The agreement called Supplementary Agreement (Agreement accesoir) made between the Guarantor Collateral Recipient about the provision of guarantees against possible defaults on loans committed Guaranteed obtained from the Receiver Warranty.