An advance Payment Guarantee, APG is a promise made by a supplier to a buyer, on receipt of an order to supply goods, pleading to compensate any upfront cost that may be incurred by the buyer in an event of a fail.
In often circumstances, APGs is used when financing a trade between different countries in international trade.
In Kenya, APGs are commonly used on construction to help a mobilizer seek funds for a project to the construction company.
When applying for a construction job, construction companies always plead to do a job and finish it according to the requirements agreed. This calls for a bond since not all suppliers meet what they detail on paper. While other bidders bid at low prices to just make sure they secure the tender, others estimate low costs and end up unsuccessful. Doesn’t sound good right?
And it does not end here, other construction companies also bid for tenders they cannot supply, and by the way, they end up filing for bankruptcy. As a buyer, you need to be sure the successful bidder delivers what you agreed, or at least have the compensation of getting to the second lowest bidder, just in case.
This is what Advance Payment Guarantees APGs are all about.
How APGs Work
When talking about APGs, let us not confuse it among other types of common bonds. These include Bid bonds and Performance bonds.
A bid bond is basically a commitment by a construction company, to assure the buyer they will receive construction services if awarded the tender. In case the construction company fails, the compensation awarded is to facilitate the process of awarding the tender to the next lowest bidder.
Here the buyer is protected from tendering for services and not receiving term, thus they have the freedom of awarding the tender without fear that a supplier might fail.
Click here to find out more about bid bonds
Performance bonds, on the other hand, are bonds that are acquired once a company secured a tender. This is to assure that they will meet the requirements agreed upon in construction.
Some of these include completing the construction, and of course, in the terms and materials agreed. To find out more about performance bonds, click here to check them out.
Why Momentum Credit?
When applying for APGs, you need to be sure of a partner that is quick, efficient and promises what you really need. This is because you can miss a tender with a slight mistake as not delivering a bid bond on time.
Momentum credit not only offers your business an opportunity with a promise of making a profit but also to help you accomplish your goal too.
With our turnaround time of fewer than 24 hours, your business is sure to meet its goals in a timely and reliable manner. The process of acquiring an APG is also relatively easy, as we do not require you to open an account with us and deposit any funds up front for it. We take it ahead, you can also get an APG at the lowest rate in the market.
With only a cash cover of 30% interest, we certainly do not require any upfront collateral.
We offer loans of up to 5,000,000.00 as you wait for the advance payment and offer very flexible payments for APGs over a period of more than a year.
This is a very little interest compared with as much as banks can charge and the time you will have to wait.
What you need:
- An Application Letter (dated and signed)
- A Bank Account Statements (for the last 6 months)
- An Audited Financial Statements (for the last 3 years)
- Copies of Company Director’s PIN certificates
- Copies of Director’s National Identity card ID s
- A Copy of the Memorandums & Articles of Association
- Copy of Certificate of Business Registration/ certificate of incorporation
- A Copy of the Company’s PIN
- A Copy of a Notification of Award letter
- A Copy of the Company Profile (Customer)
- Copies of previous LPOs/Contracts serviced
- Copies of Payment Certificates and invoices (current or previous)
When running a Small or a medium sized Business, SME, working with partners that fulfill your requirements and dynamic needs is key. That is why at momentum credit we offer fast, reliable and no hidden costs APG services.
This, in the long run, helps foster stronger business and profits at large. To find out more about our services, reach us out on momentumcredit.co.ke. For any inquiries, you can also reach us directly via Contact us and we will be happy to help.