CHAPTER 35 - TYPES OF STANDBY CREDIT IN ISP

Performance Standby

Supports an obligation to perform other than to pay money, including for the purpose of covering losses arising from a default of the applicant in completion of the underlying transactions. 

Advance Payment Standby

Supports an obligation to account for an advance payment made by the beneficiary to the applicant.

Bid Bond/Tender Bond Standby

Supports an obligation of the applicant to execute a contract if the applicant is awarded a bid.

Counter Standby 

Supports the issuance of a separate standby or other undertaking by the beneficiary of the counter standby.

Financial Standby

Supports an obligation to pay money, including any instrument evidencing an obligation to repay borrowed money.

Insurance Standby

Supports an insurance or reinsurance obligation of the applicant.

Commercial Standby

Supports the obligations of an applicant to pay for goods or services in the event of non-payment by other methods.

Direct-pay standby

Where there is no Advising Bank. It is intended to be the primary means of payment, and may or may not be linked to a default in performance or payment. This is identical to Direct Pay Letter of Credit or Direct Credit or Straight Credit.