Advance payment guarantee
An advance payment guarantee is a bank's promise to repay the client's mobilisation advance if the contractor fails to perform. It usually reduces as the advance is recovered from each certificate.
Where you meet it
See the tendering guide and the advance recovery calculator. SupaJack Construct records the guarantee's face value as a memorandum, not a ledger posting, because no money has moved. Related: advance payment and performance guarantee.
Why it matters
Because the client's risk falls as the advance is repaid, contractors should ask for the guarantee to reduce in step with recovery, which lowers the bank commission they pay.