Payment Guarantee Letter Format

Payment Guarantee Letter Format


[Date]

[Recipient’s Full Name]
[Recipient's Position]
[Recipient's Company Name]
[Recipient's Company Address]

Dear [Recipient's Name],

This Payment Guarantee Letter ("the Guarantee") is issued by [Your Company Name] located at [Your Company Address] ("the Guarantor"), to [Recipient’s Company Name] (“the Beneficiary”), as a commitment to fulfill payment obligations for [purpose] between [Your Company Name] and [Beneficiary’s Company].

1. Guarantee Scope

This Guarantee is issued in connection with the agreement dated [Date] (the "Agreement") between [Your Company Name] and [Recipient’s Company] regarding [Project Description]. Under the terms of this Guarantee, the Guarantor unconditionally and irrevocably guarantees payment of up to [Amount in Words and Currency].

2. Conditions of Guarantee

The payment shall be made upon receipt of written notification from [Recipient’s Company Name] stating that [Your Company Name] has failed to fulfill the payment obligations as per the Agreement. Such notification must include:

  • Copy of the signed Agreement,

  • Details of unpaid invoices or payment terms violated, and

  • Proof of compliance with terms and conditions of the Agreement.

3. Payment Terms

The Guarantor agrees to make payment to the Beneficiary within [Specify Number of Days] of receiving the above-mentioned notification.

4. Validity of Guarantee

This Guarantee shall remain valid and enforceable until [Expiration Date] unless a written extension is mutually agreed upon by all parties.

5. Governing Law

This Guarantee shall be governed by and interpreted in accordance with the laws of [Jurisdiction].

We hope this Guarantee assures you of our commitment to the agreed terms and look forward to a successful partnership. Please feel free to reach out if any further clarification is required.

Yours sincerely,


[Your Name]
[Chief Financial Officer]
[Your Company Name]
[Your Email]


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