Purchased Bank Guarantee
It tend to be very expensive; as a matter of fact the fees and charges can still run as high as 35% - 40% of the guarantee amount every year. The fee usually consists of an initial setup fee and an annual fee, both of which will be a percentage of the dollar amount that the issuing bank “guarantees” (or covers) in the event that the company is not able to pay its debts before the expected deadline.