Payment Guarantees for Green Transition

Supplier Payment Guarantee

A Supplier Payment Guarantee secures entrepreneur's obligations towards his suppliers, both domestic and foreign. When purchasing components, materials, or services destined for export production, KUKE’s guarantee allows the entrepreneur to obtain extended payment terms from his suppliers, thus improving his liquidity. KUKE’s guarantees 80% of the entrepreneur's payment obligations.

What are the benefits for the entrepreneur?

• A Supplier Payment Guarantee enables the entrepreneur to obtain extended payment terms, improves the entrepreneur's cash flow and increases his liquidity to fulfill new orders.
• The entrepreneur's supplier is guaranteed to receive payment for the components or materials delivered to the entrepreneur.
• The entrepreneur gains an excellent tool to negotiate deliveries on better financial terms with partners from all over the world, including Poland.
• If a foreign supplier prefers a guarantee from a well-known local bank, KUKE may counter guarantee such transactions, securing the entrepreneur's payment obligations.

Supply Chain Finance Guarantee

A Supply Chain Finance Guarantee secures entrepreneur's payment obligations towards financial entities, mainly factoring companies, purchasing accounts receivables from companies supplying goods and services to the entrepreneur. KUKE bears a large portion of the risk incurred by the financial institution (factor), allowing it to safely finance greater volume of transactions.

What are the benefits for the entrepreneur?

The guarantee improves entrepreneur's cash flow and increases his liquidity to fulfill new orders by benefiting from extended payment terms (e.g. the invoice with a payment term of 14 days issued by a supplier is purchased by the factoring company, allowing the entrepreneur to settle accounts with the factoring company in 60 days).

Working Capital Loan Repayment Guarantee

This guarantee secures the timely repayment of a working capital loan granted to an entrepreneur for their ongoing operations. In the event the entrepreneur fails to repay part or all of the loan, along with interest, fees, and other amounts due under the agreement with the financial institution, the guarantee comes into effect.

For whom?

For entrepreneurs applying for a working capital loan or other revolving financial obligations at a bank.

What are the benefits for the entrepreneur and the bank/financial institution?

• The entrepreneur gains access to financing for their day-to-day operations.
• In dealings with the bank, the entrepreneur can significantly increase the available financing amount — KUKE guarantees reduce the entrepreneur's use of their bank limit by 80%.
• The bank can increase its commitment to financing the entrepreneur by up to five times.
• In dealings with a financial institution other than a bank, the entrepreneur has the opportunity to take on a financial obligation other than a typical loan, and the financial institution receives a reliable guarantee of the entrepreneur's repayment.

What are the terms of cooperation?

• The loan granted by the bank or other financial obligation taken on by the entrepreneur must be related to the entrepreneur's ongoing and revolving activities.
• The guarantee is issued at the entrepreneur's request in favor of the financing bank or other financial institution.
• Cooperation is based on a limit or on individual terms.
• The limit is set for a period of one year, during which guarantees can be issued. The validity of the limit can be extended for additional one-year periods.
• If the entrepreneur does not meet the limit criteria, they may obtain a guarantee on individual terms to secure financing and supplies for a specific transaction.
• The guarantee covers up to 80% of the entrepreneur's obligations.

Do you have questions? Please contact us.

*Starting, continuing or developing economic activities that make a significant contribution to climate change mitigation, as referred to in Article 10 of Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on establishing a framework to facilitate sustainable investment.