UAE Bank Guarantees for Business Contracts & Licenses
Many UAE government contracts, trade licenses, and commercial agreements require a bank guarantee. Arab First guides you through the application process with UAE banks.
Six Types of UAE Bank Guarantees
Arab First handles all major UAE bank guarantee types — from government tender bonds to commercial rental guarantees.
Tender / Bid Bond
Required when submitting bids for government tenders — assures the contracting authority you can deliver on your bid
Performance Guarantee
Guarantees you will complete a contract as specified — typically 5–10% of contract value
Advance Payment Guarantee
Protects buyers when advance payments are made to contractors or suppliers before delivery
Payment Guarantee
Assures a seller that payment will be made on time — used in international trade transactions
Customs Guarantee
Required by UAE Customs for temporary importation of goods — released once goods are re-exported
Rental Guarantee
Guarantees rental payments — often required by commercial landlords in lieu of multiple post-dated cheques
Bank Guarantee in 4 Steps
Requirement Assessment
We review your contract or tender requirements to confirm the type, amount, and validity period of guarantee required.
Bank Selection
Arab First recommends the most suitable UAE bank based on your guarantee type, company profile, and existing banking relationships.
Application Preparation
All required documentation compiled and submitted to the bank — including company documents, financial statements, and guarantee format.
Guarantee Issuance
Bank guarantee issued typically within 5–15 working days. Arab First liaises with the bank throughout and delivers the guarantee to you.
Bank Guarantee vs Alternatives
| Feature | Bank Guarantee | Cash Deposit | Letter of Credit | Insurance Bond |
|---|---|---|---|---|
| Cost | 0.5–2% p.a. of guarantee amount | Full cash blocked | 3–5% p.a. of value | Insurance premium |
| Cash Impact | Facility or collateral only | 100% cash blocked | Facility-based | Premium only |
| Bank Approval | Required | Not required | Required | Insurer approval |
| Processing Time | 5–15 days | Immediate | 5–15 days | 3–7 days |
| Best For | Most commercial uses | Simple/short needs | Trade transactions | Specific sectors |
Bank Guarantee FAQs
What is a bank guarantee in the UAE?
A bank guarantee (BG) is a formal commitment from a UAE bank to pay a specified amount to a beneficiary (typically a government body or commercial counterparty) if you fail to meet your contractual obligations. It is widely required for government tenders, commercial contracts, and certain trade licenses.
How much does a UAE bank guarantee cost?
Bank guarantee fees typically range from 0.5% to 2% per annum of the guarantee value, depending on the bank, your credit profile, and whether the guarantee is fully cash-collateralized or facility-based. Arab First negotiates competitive rates with our banking partners.
Which UAE banks provide bank guarantees?
All major UAE banks issue bank guarantees, including Emirates NBD, Abu Dhabi Commercial Bank (ADCB), Mashreq, Dubai Islamic Bank, First Abu Dhabi Bank (FAB), and RAK Bank. Arab First works with all major banks and has established relationships that facilitate faster processing.
Can a new company get a bank guarantee?
New companies may face additional requirements such as full cash collateralization. Arab First assists new companies in structuring their bank guarantee applications by advising on the right bank partner, required documentation, and collateral options.
How long does UAE bank guarantee processing take?
Typically 5–15 working days from submission of complete documentation. Arab First prepares all required documents upfront to minimize delays and liaises with the bank throughout the process on your behalf.
Get a Bank Guarantee Today
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