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Financial Guarantee Draft
The Problem Of Bank Guarantee
Financial Guarantee Procedures
Financial Indemnity Bond
Funding Fees
Loan Procedure
Funding Request
Executive Summary
Financing' Source highlights
BusinessAfrica's Fees and Service
THE BANK GUARANTEE PROBLEM


Funding sources always require from Borrower a good and secured collateral before signing any loan agreement. That is normal. They want to make sure that they shall recover their funds in case of loan-payment's default from the Borrower. Here are listed collateral most used on the international financial marketplace

The problem of collateral - and particularly the most appreciated by financiers: the Bank Guarantee - is not easy to secure from the African commercial banking system. And most of the times development projects with high potential to making profit end up in limbo.

African entrepreneurs are obliged to rely only on their own meager financial resources to implementing their initial project or undertaking the expansion of an existing one. Even government sponsored-projects - necessary to establishing vital infrastructures: roads, railways system and so on - take years to reach the launching pad. For lack of funds.

This is a serious matter, which needs to be properly addressed to finding solutions as African countries are desperate to implementing vital infrastructure and other industrial development projects to bridge the developing gap.

To quickly have access to much needed financial means, it is an absolute necessity for African entrepreneurs and governments to make use of the alternative offered by the international commercial banking system; as it operates with less red tape procedures and quick disbursement delays compared to the International Financing Organizations such as the International Monetary Fund - IMF - and The World Bank.

- Till now the financing option and advantages of the international commercial financing system (speediness of decision and short disbursement period) have not been fully used by the African business community. For lack of sufficient expertise in the field. And also for lack of good documentation and preparation of the loan-request package.

- It is obvious that a project which is structured to having the following parameters:

1- International and regional equity partners in addition to the national investors.

2- An international technical partner.

3- A marketing plan for local, regional and international markets.

4- Production's Purchasing Agreement with international purchasers.

Will be far more appealing to direct foreign investors and to the commercial financing banking system. And even more if related Feasibility Study and Business Plan are professionally drafted with a particular focus on the cash-flow.

Once above conditions are met, borrower could either arrange for a Financial Guarantee; or combine insurance and reinsurance policies as collateral - particularly in case of the expansion of an existing operation.

- Dr. Quenum and Associates are in the position to assist any African investor fulfilling the above mentioned parameters through a proven planning strategy.

Furthermore Dr. Quenum and Associates have working relationships with funding sources which may consider a collateral option based on insurance and reinsurance policies associated with a FINANCIAL INDEMNITY BOND - (FIB) and assist in finding financing / funds for viable project backed by comprehensive Feasibility / Business Plan.

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WHAT IS A BOND AND HOW IT WORKS


A Bond is a written promise, provided by a Surety or Guarantor, to pay the direct loss and damage suffered by the beneficiary of the Bond, as a direct result of the breach of contractual obligations of the Surety or Guarantor's client. Click this link for Frequently Asked Questions on Bond, Surety, Indemnity. Etc.

- Below outlined is the gist of the procedure to arranging a Financial Indemnity Bond

1- Borrower should contact an Insurance Company and arrange for an Insurance Policy, which satisfies the international wording / verbiage of lending Banks or Institutions.

2- Such Policy has more impact if backed by the Reinsurance Partner(s) in Europe / Asia and Americas of the Borrower's Insurance Company.

3- The Insurance Company should then issue a Financial Indemnity Bond, thereby Guaranteeing Payment in full, any Lender to whom the Bond is presented by the Borrower.

4- Said Financial Indemnity Bond could be accepted as viable collateral by Dr. Quenum & Associates / Financing Partners if the Insurer(s) are rated 'AA+' or 'AAA'.

5- If the Insurance Company is not rated 'AA' or 'AAA' but is affiliated to a 'AA+' or 'AAA' rated Re-insurer Partner, then Dr. Quenum & Associates and Financing Partners will accept the Re-insurance Company Binder of the Insurance Company's [F.I.B.] - Subject to mutual modification, if necessary, of the FIB wording / verbiage.

With said combination of insurance and reinsurance policies / FIB - and adequately drafted Feasibility Study and Business Plan - an existing company is in the position to negotiate and secure large amount of funds - in the range of hundred to billions of US $ - for the expansion of its operation.

- Remark: Please kindly be advised that funding source and guarantor identities will be disclosed to borrower(s) only after a Non Disclosure Non Circumvent - NDNC - Agreement had been signed between Borrower(s) and BusinessAfrica™ / Dr. Quenum and Associates. Click here for more on How Financing Research's Brokerage Works

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APPLICATION PROCEDURES
SEQUENCE OF EVENTS FOR FINANCIAL INDEMNITY BOND

-1. Applicant sends Executive Summary to BusinessAfrica™ / Dr. Quenum And Associates / Assistance Partner(s) for analysis and review.

The summary should be strictly drafted according to indications available at following link.

(a.) Financing required.
(b.) Use of funds.
(c.) Particularly the listing of assets that will be used to secure the Loan should be attached.

-2. Dr. Quenum & Associates' Assistance Partner(s) review the executive summary and send feedback to the Client / Borrower(s) either for additional information / input or to confirm that project meets the criteria of the Lenders.

-3. Borrower(s) Primary Insurer, also known as the "Seeding Company" shall issue one of the following documents: a)- Indemnity Bond / or b)- Insurance Bond / or c)- Surety Bond or equivalent on behalf of Borrower(s).

-4. Borrower(s) Primary Insurer shall then contact and confirm with its Re-insurer that the Re-Insurer will provide reinsurance for the bond at one of their offices in Europe / Asia / Americas.

-5. Once this is confirmed then the bond and re-insurance stipulations shall be presented to the LENDER (channeled through Dr. Quenum & Associates) for verification of text / verbiage with the Re-insurer.

-6. Once approved, THE LENDER will take note of the Re-insurance value - which will be set by the Re-insurer and lend UP TO 80% of that value.

Example: if the re-insurance value is US$ 100 million, THE LENDER will lend US$ 80 million.

-7. Should the Client / Borrower(s) indicate their interest in assistance from Dr. Quenum & Associates with the PREMIUM for the reinsurance-policy, then we Dr. Quenum & Associates could arrange for the premium to be put in an escrow account - by THE LENDER - and paid directly (out of proceeds) to the Re-insurer.

-8. Only after the PREMIUM is paid will the bond be a LIVE INSTRUMENT. The funds will be then be put in a BLOCKED ACCOUNT and trading will begin within a week.

-9. A meeting is then scheduled between Dr. Quenum And Associates / Assistance Partner(s) and the Client / Borrower(s) to finalize details. At this stage, Client / Borrower(s) to sign and sent back to Dr. Quenum & Associates a PAY ORDER for services and duties rendered by Dr. Quenum & Associates.

- The final responsibility of locating a lender rests with the Client / Borrower(s) through a Non Disclosure Non Circumvent - NDNC - Agreement signed between Client / Borrower(s) and Dr. Quenum & Associates.
Click here to read about "How Financing Research' Brokerage Works".


- REMARK: Borrower(s) may compare the costs and faisability of the two possibilities of Guarantee and Collateral's enhancement offered by Dr. Quenum & Associates: 1- Financial Guarantee. 2- Financial Indemnity Bond and opt for the one, which suits them best.

- If you are planing to expand the operations of your existing business and have assets insured with a local insurance company, you may reinsure the said assets with a AAA local representative of an international (Europe/ Americas / Asia) reinsurance company; and negotiate the issuance of a)- Financial Indemnity Bond / or b)- Insurance Bond / or c)- Surety Bond or equivalent. Click here for Frequently Asked Questions.

- We recommend the usage of the "Financial Guarantee" facility if you cannot get an Insurance company to backing your project.

Click here for Frequently Asked Question on Surety

Completed "Funding Request" and attached "Executive Summary" to be sent to Dr. Quenum & Associates, making use of the Contact & Support Console as per instructions below outlined

Locations of visitors to this page

- Interested parties - private African and international investors / companies, government agencies, international development agencies - to make contact through the Free Access Support Console available at this link

Contact through the support console will get quickest reply from Africabiz Online's staff, than contact by emails. Click here for contact information. Be advised that first contact should be through the support console to be followed by phone calls. If you are a VIP-Member, use VIP-Members Support Console available here.
Before you consult please click here to review this clarification

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