Banker’s Guarantee/SBLC

Banker’s Guarantee/Standby Letter of Credit

Provide payment assurance to your beneficiaries

Reassure your buyer or seller of payment with DBS Banker’s Guarantee/Standby Letter of Credit. In the event that you fail to fulfil your contractual obligations, we will honor payment to your beneficiaries upon receipt of a claim that complies with the Guarantee terms.

 

How do I apply

  • Customers with an existing trade credit facility with DBS, please apply with DBS IDEAL. Alternatively, you can submit your application form and a copy of the guarantee format to any of our Trade Document Counters or DBS branches.
  • Customers who require a cash-backed Banker’s Guarantee, please click the button below to apply via Online Banker’s Guarantee

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How does Banker’s Guarantee/Standby Letter of Credit work?

 

  1. Applicant and beneficiary enter into a contract and agree that a Banker’s Guarantee is required
  2. Applicant approaches DBS (issuing bank) to issue a Banker’s Guarantee in favour of the beneficiary
  3. DBS issues the Banker’s Guarantee, and
    1. sends a financial instruction to an advising bank, which is usually located in beneficiary’s country, or
    2. couriers the hardcopy Banker’s Guarantee to the beneficiary, or
    3. notifies the applicant of self-collection at any of our ten Trade Document Counters or collection branches
  4. Once the advising bank receives the Banker’s Guarantee, it will advise it to the beneficiary

 

Why choose DBS Banker’s Guarantee/Standby Letter of Credit?

  • Grow your business with the Best Trade Finance Bank in Singapore, as named by Alpha Southeast Asia and The Asian Banker in 2012. We also received this accolade from Global Finance in 2012, for the 8th consecutive year
  • Leverage DBS Bank’s AA- and Aa1 credit rating to provide your beneficiary with payment assurance upon receipt of claims made out in compliance with the Guarantee terms
  • Submit your application through any DBS or POSB branch, or IDEAL™ (our online banking platform) for greater convenience
  • Collect your banker’s guarantee from any of our ten conveniently located Trade Document Counters and DBS collection branches

Product details

 

  • A Banker’s Guarantee/Standby Letter of Credit can be used as a:
    • Payment Guarantee – This protects the beneficiary in the event that the applicant fails to honour the payment under their contract
    • Bid Bond – This enables the applicant (bidder) to use DBS’ credit to support the bid, and can also be used to insure the successful bidder that the contract will be met
    • Performance Bond – Some bidding contracts require the successful bidder to provide a performance guarantee to protect against a default
    • Financial Guarantee – This helps the applicant’s overseas subsidiaries obtain financing or credit facilities from banks

  • The Guarantee can be issued by DBS Singapore or by our overseas branches/correspondents, according to the guarantee format provided by the applicant
  • Guarantees issued in favour of beneficiaries must be for a specific amount, expiry date and claim period
  • Guarantees should not be assigned to other parties.
  • Guarantees are subject to Singapore law and the jurisdiction of the Singapore courts
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    Item

    Pricing

    Issuance

    Financial BG/SBLC : 2% p.a. 
    Non-Financial (Performance) BG/SBLC:
    1% p.a. upto 2 years
    1.5% p.a. above 2 years
    Min commission:
    SGD 100 (Direct BG - Standard Format)
    SGD 200 (Direct BG - Non-Standard Format)
    SGD 300 (Indirect BG plus overseas bank issuance charges)

    Issuance (against Incoming Counter Guarantee/Counter Standby)

    Subject to arrangement

    Issuance of Letter of Confirmation for Standby LC

    Subject to arrangement

    Amendment

     

    – Tenure

    Same as issuance commission, min SGD 100

    – Amount

    Same as issuance commission, min SGD 100

    – Others

    SGD 80

    BG/SBLC Advising

    DBS account holder: SGD 30
    Non-DBS account holder: SGD 60

    Authentication of hardcopy BG(issued by other bank)

    S$200 flat

    Handling of Inward Claims under BG/SBLC

    S$200 flat

    Handling of Inward Claims under BG/SBLC (Pay or Extend)

    Same as Issuance Commission, subject min S$200

    Collection Service

     

    – Presentation of Demand & Documents under BG/SBLC (issued by other banks)

    1/8% flat, min S$200

    – Signature verification (only without collection service)

    S$200 flat per document

    Request for Transfer /Acknowledgement of Notice of Assignment or Transfer

    Subject to arrangement (Min 0.25%, but not less than S$500)

    Miscellaneous Fees

    Vetting fee, cancellation fee, handling outward claims, handling of assignments, Certified true copy and Re-Issue of Guarantee (incorporating amendments) where applicable at a min of SGD 200

    Others

    Tracer Fees S$10, Postage S$2, Courier S$10 (local) min S$25 upwards (overseas)

    Processing fee under advance payment arrangement**

    S$100

    FAQs

    How do I know when to apply for a Banker’s Guarantee or a Standby Letter of Credit?

    The guarantee format provided by the beneficiary will specify whether you should apply for a Banker’s Guarantee or Standby Letter of Credit.

    How do I complete the Banker’s Guarantee/Standby Letter of Credit application form?

    Please refer to the comprehensive explanatory notes or call our banker’s guarantee officers at 1800 222 2200.

    Where do I find a Banker’s Guarantee/Standby Letter of Credit format?

    The standard formats for commonly used Banker’s Guarantee/Standby Letter of Credit are provided on this page, under the header “Forms”. Alternatively, you may ask the beneficiary of the Banker’s Guarantee/Standby Letter of Credit to provide a format.

    How long does it take to process a Banker’s Guarantee/Standby Letter of Credit?

    We can process your Banker’s Guarantee/Standby Letter of Credit within 24 hours upon receipt of a complete application using DBS standard format, subjected to the availabiliy of your credit facility.

    Where do I collect my Banker’s Guarantee/Standby Letter of Credit?

    You may collect it from any of our Trade Document Counters or collection branches. We have five trade counters at Marina Bay Financial Centre, Towner and Jurong Gateway (Toh Guan) while our five DBS collection branches are at Buona Vista, Tai Seng, Jurong Point, Telepark and Woodlands.