A credit guarantee is a commitment by the LGA in a situation, if an entrepreneur for some reason is not able to repay at the necessary payment time. In such case the LGA undertakes to reimburse the commercial bank for principal amount of payment not repaid.
Thus the objective of a credit guarantee is the provision of credit resources for an entrepreneur to implement his business in situations, when the entrepreneur does not have the resources at his disposal, in order to receive credit at a bank.
The conditions for the issuance of a guarantee can be found here: "Regulations Regarding Guarantees for Improving the Competitiveness of Merchants"
