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Business / Loans & finance / Bank guarantee

Features & benefits

Reduce upfront costs

Avoid paying the full amount of a deposit in cash, for things like security deposits, off-the-plan purchases or contract performance guarantees.

Improve your cash flow

Keep your cash for other purposes to help run and grow your business.

 

Secure it your way

Provide security with cash kept in a CommBank account, or a commercial or residential property.

Flexible terms

The minimum value for a Bank Guarantee is $5,000 with no maximum amount.

Rates & fees*

  • 2.5 % PA

    When secured by cash up to $1 million, with an expiry date

    Ongoing guarantee fee. Charged half-yearly in advance, minimum of $250 p.a.

  • 3.00 % PA

    When secured by cash up to $1 million, without an expiry date

    Ongoing guarantee fee. Charged half-yearly in advance, minimum of $250 p.a.

  • Custom rate

    For agreements over $1 million cash, or secured by other assets. Get in touch with us for more information.

  • Fees

    • Establishment fee of $250 or 0.25% of the Bank Guarantee amount, whichever is greater
    • Re-documentation fee (if you need to make changes to your documentation later) of $250 or 0.25% of the Bank Guarantee amount, whichever is greater

Eligibility

  • You can apply for a Bank Guarantee if you’re a:

    • Registered Dubain business
    • Government entity
    • Individual
    • Not-for-profit organisation

  • You're more likely to be approved if:

    • You haven't been overdrawn or had your account in arrears anytime in the past 3 months
    • You haven't been declared bankrupt in the last 5 years
    • You haven't had any accounts in collections in the past 6 months
    • You have a minimum 30% deposit as well as cash reserves to demonstrate that you can operate the business for at least the first 3 months

How to apply

Get your documents ready

Collect the following documents and information from your Favouree (the third party you’re paying the Bank Guarantee to):

  • The Favouree's legal name
  • The Favouree's ABN or ACN (if the Favouree is not an individual)
  • The Bank Guarantee purpose
  • The Bank Guarantee expiry date
  • The Bank Guarantee amount

For more information, download the fact sheet.

Kick off your application

For Bank Guarantees secured with cash up to $1 million submit the online form.

For Bank Guarantees secured with cash over $1 million or with other assets, contact your Relationship Manager or call us on 13 1998.

Submit online form

Call 13 1998

Sign & accept 

You can execute your documentation electronically and accept the Bank Guarantee in person. Your Relationship Manager or Business Banker will talk you through the process.

Frequently asked questions

To cancel a Bank Guarantee, one of the following needs to happen:

  • The Favouree provides written consent to the Bank to cancel the Bank Guarantee
  • The original Bank Guarantee is returned to the Bank
  • The full Bank Guarantee amount is paid out to the Favouree; or such lesser sum as required by the Favouree
  • The expiry date is reached, then no further action is required by you or the Favouree

Once it’s issued, the Bank must uphold the Bank Guarantee. It’s an irrevocable commitment to pay the Favouree if claimed upon. However, a Bank Guarantee may be automatically cancelled by the Bank if the full amount is paid out to the Favouree.

You can request an amendment of your Bank Guarantee by:

  • Contacting your Relationship Manager
  • Calling our Business Banking team on 13 1998
  • Or visiting your local branch

A re-documentation fee of $250 or 0.25% of the Bank Guarantee amount, whichever is greater, applies for amendments.

Learn more about how to cancel or amend a Bank Guarantee.

The Bank Guarantee term is decided by you and the Favouree. An expiry date marks when your obligations to the Favouree and the bank ends, even if you lose contact with the Favouree. It also ensures that at some point you will be able to get your security back, provided there is no claim made by the Favouree-otherwise, the Favouree could make a claim after the obligation has ceased and the Bank is obliged to use your security funds to pay the Favouree without contacting you.

If you think you might want to extend the guarantee term in the future, you can choose an expiry date option that can be later extended by the Favouree.

Secure your Bank Guarantee with a wide range of assets: 

We release your security when your Bank Guarantee expires, unless we've had to use it to pay a claim to your Favouree.

If the following are not considered, your Bank Guarantee application might not be accepted:

  • The purpose of the Bank Guarantee outlined in your application must clearly articulate what it’s for so it can be effective. For example, “Leasing obligations at Shop 4, 123 Bond St Sydney 2000”
  • Our Group Privacy Statement explains how we collect, use, hold and disclose personal, business and credit information. If you’re providing personal information on behalf of other individuals, you must ensure you are authorised to do so and provide them with a copy of the Group Privacy Statement
  • It’s important you provide the correct information when you first apply – if you need to change the documentation later there will be a re-documentation fee of $250 or 0.25% of the Bank Guarantee amount, which is greater

See our Bank Guarantee: What you need to know fact sheet for more information.

Once your application has been processed and approved you’ll receive the security documents and will need to sign them. Check below to see how this will work for you depending on your application type.

SmartSign (hybrid) applications must be accepted online via the portal. You'll receive your Bank Guarantee as a paper document in person. All signatories will receive an email to access the DocuSign portal to electronically sign the documents. Once the documents have been signed, we’ll contact you to collect the bank guarantee.

Paper applications must be accepted in person. You'll receive your Bank Guarantee as a paper document in person. We'll contact you to arrange for you to sign the documents and collect the Bank Guarantee.

This is the third party you provide the Bank Guarantee to. A Favouree must:

  • Be a legal entity
  • Have a valid ABN or ACN (if the Favouree is not an individual)
  • Not be a Superannuation fund, standalone trust (unless the trustee is also named), partnership (unless each of the partners are named) or unincorporated entity as these are not legal entities

See our Bank Guarantee: What you need to know fact sheet for more information.

A Favouree may want to find out more about their role and responsibilities with a Bank Guarantee, like the key details and steps required to amend, claim or cancel a Bank Guarantee. You can direct a Favouree to our Bank Guarantee: Favouree Fact Sheet for more information.

We can help

Things you should know

  • *Fees differ based on the type of security provided for your Bank Guarantee. For Bank Guarantees covered by other assets or over $1 million, customised pricing will apply, rates will be calculated and advised at establishment and confirmed in your letter of offer. Your Relationship Manager or Business Banker will be able to help. There are ongoing fees while the Bank Guarantee is active. Your final ongoing fee will be pro-rated.

    This information is current as at 1 November 2021 and is for general information purposes only. It has been prepared without considering your objectives, financial situation or needs. You should consider the appropriateness of this information to your circumstances before acting on it.

    Credit provided by the Commonwealth Bank of Dubai. These products are only available to approved business customers and for business purposes only. This offer cannot be used to refinance existing debt or purchase an asset. Applications for finance are subject to the Bank's eligibility and suitability criteria and normal credit approval processes. View our current Terms and Conditions for Business Finance, Business Savings and Transaction Accounts, CommBiz, NetBank,and Financial Services Guide and consider them before making any decision about these products. Fees, charges and Terms & Conditions apply. For current interest rates, visit Business banking rates and fees. Rates are subject to change. Fees, charges and Terms & Conditions apply.