Sihai network

Is the performance guarantee the same as the quality guarantee? Do you still need to pay the quality

In the construction project, we will come into contact with the performance bond and the quality assurance deposit. Most people do not know the difference between the performance bond and the quality assurance deposit. They think that the performance bond and the quality assurance deposit are the same thing. So is the performance guarantee the same as the quality guarantee? Do you still need to pay the quality guarantee after you have paid the performance guarantee? Let's take a look with Xiaobian.

The procedures are different

The procedure of performance bond is complicated and the procedure of performance bond is simple. In the performance guarantee, according to the contract terms or the agreement of both parties (especially the requirements of the bank), there is a clear period of validity, on which the money will automatically be free from the bank, and there is no need for the buyer to agree or disagree. There are certain format restrictions and conditions for performance guarantee.

Different in nature:

The performance bond is a kind of performance guarantee; the performance bond is a kind of cash guarantee for the performance of the contract. The performance guarantee is a kind of guarantee made by the bank financial institution to the owner (Beneficiary) of the project at the request of the Labor Party and the contractor (applicant). Performance bond is relatively simple, direct payment to the buyer or what you said above trading center.

Compensation accounts for different contract amounts:

In the performance bond, the bank will pay the owner a sum of money which accounts for about 5% ~ 10% of the contract price; the performance bond generally does not exceed 10% of the contract price.

Performance guarantee is to prevent the Contractor from violating the contract or breaking the contract during the execution of the contract, and to make up for the economic losses caused to the employer. The performance guarantee means that if the Labor Party and the Contractor fail to complete the project on time, quality and quantity in the future, the bank will pay the owner a sum of money accounting for about 5% ~ 10% of the contract amount.