Advance/stage payment bonds

Advance/Stage Payment Bonds (APBs Guarantee) are particularly prevalent in the engineering, manufacturing and construction sectors, although they are also used in other industry sectors. These APBs provide a guarantee to the customer that monies provided in advance of goods/services will be reimbursed if the contractor defaults.

This type of Advance/Stage Payment Bond or APB Guarantee is best provided by a specialist surety company rather than a bank, as it can usually be arranged on an unsecured basis. In addition, a bond arranged in this way will not restrict working capital and more equitable bond wordings can be secured.

Applicant/risk

  • Construction companies
  • Engineering companies.

Beneficiary

  • Local authorities
  • Government bodies
  • Commercial companies