Clearing members may opt for giving bank guarantee in the specified formats towards liquid assets. Additionally, at the time of deposit of the bank guarantee, the clearing member is required to ensure the following:

1. The bank guarantee is strictly as per the formats prescribed by the clearing corporation.




2. A bank guarantee for security deposit should be issued for a minimum period of 12 months with a specific claim period of at least 3 months. However, where an issuing bank does not provide for a specific claim period beyond the expiry date in the bank guarantee, the clearing members shall submit a bank guarantee for a minimum period of 15 months. The maturity period of such bank guarantee shall be reduced by 3 months, which would be considered as the claim period of the bank guarantee.




3. A bank guarantee for margin deposit should have validity for a minimum period of 3 months. In case the issuing bank does not provide for a specific claim period beyond the expiry date in the bank guarantee, the maturity period of such bank guarantee shall be reduced by 7 days, which would be considered as the claim period of the bank guarantee.




4. While filling the details in a bank guarantee, clearing members shall ensure that:

• No relevant portion is left blank


• All handwritten corrections and blanks are attested by the bank by affixing the bank seal / stamp duly authorised


• All irrelevant portions struck off on the printed format should also be authenticated by the bank by affixing the bank seal / stamp duly authorised.


• Each page of the bank guarantee should bear the bank guarantee number, issue date, stamp of the bank and should be signed by at least two authorised signatories.


• The clearing member should also ensure that the bank guarantee is free from any discrepancy before the same is submitted to the Clearing Corporation.


• The stamp paper should be issued in the name of the clearing member or the bank, no third party stamp papers are permissible.


• The stamp paper should not be older than 6 months from the executed date of the bank guarantee/ renewal.

In case the bank guarantee does not strictly conform to the above-mentioned conditions, the same shall not be accepted by the Clearing Corporation and benefit for the same shall be made available only upon the bank guarantee being strictly in conformity with the prescribed requirements.

The acceptance of the bank guarantees by the clearing corporation shall be subject to the bank-wise and member-wise limits as are stipulated from time to time. The maximum value of bank guarantees that can be given from the issuing bank per clearing member is as provided below:

Networth of the issuing bank *	Applicable total limit per clearing member across all segments
Rs. 100 crores <= NW < Rs.200 crores	Rs 5 Crore
Rs. 200 crores <= NW < Rs.500 crores	Rs 10 Crore
Rs. 500 crores <= NW < Rs.1000 crores	Rs 15 Crore
Rs. 1000 crores <= NW < Rs.2000 crores	Rs 25 Crore
Rs. 2000 crores <= NW < Rs.3000 crores	Rs 35 Crore
>=3000 crores **

* In respect of bank guarantees issued by the designated clearing banks the maximum value of bank guarantees that can be accepted from each of these designated clearing banks shall be set at the next higher slab in which they would have ordinarily been, compared with their net worth.

** Over Rs. 3000 crores, for each Rs.1000 crores of net worth, an incremental limit of Rs.10 crores per member is allowed.

Based on the category of the member the above limits shall be subject to a maximum amount as mentioned below:

Rupees in Crores

Category of member	Applicable total limit per clearing member across all segments
Professional Clearing Members / Custodian Clearing Members	200
Trading Cum Clearing Members in F&O segment	100
Other categories of the members	50

Clearing members are advised to check their applicable limit before getting their bank guarantees issued.

Reminder letter
Reminder letters are downloaded on a monthly basis through the extranet in respect of the Bank Guarantees those are due for renewal in the following month. Path for the letter is FAOFTP/F/LETTERS/DNLD. Further, the file naming convention for the same is F_REMINDERS_MEMBER CODE_DDMMYYYY.LIS.

Renewal of Bank Guarantees
Clearing members are required to ensure that the renewal of the bank guarantee is submitted to the Clearing Corporation in the prescribed format well in advance before the date of expiry of the bank guarantee.

Shifting of the Bank Guarantee from CM segment / Currency Derivatives segment to F&O segment
Clearing members, who intend to release the Bank Guarantee provided as margin deposit in CM segment/ Currency Derivatives and add the same as margin deposit in F&O segment, are required to submit a release request in CM segment/ Currency Derivatives Segment through CIM and submit a letter as per the format to Clearing Corporation requesting for the same. The clearing member is further required to provide an amendment letter executed from the respective bank as per the format .