A Performance Bond is a guarantee issued by a bank to guarantee satisfactory completion of or performance on a project by a Contractor. A Performance Guarantee makes sure that a product or service will be performed as agreed in a contract and if not a claim can be made against the bond on first demand.
Performance bonds serve as a guarantee that the contractor will finish the project correctly and satisfactorily and the amount that is payable will usually be around 10% of the contract value.Contractors who perform private sector or government work need a performance bond for each project.
A performance guarantee or bond is usually issued after the contracted tender has been awarded and after the bid bond is cancelled.
TRADEFINANCE.AFRICA COUNTRIES OF EXPERTISE