Guarantee Scheme
/ˈɡær.ən.ti skiːm/
Definitions
- (n.) A structured plan or arrangement established by a government or financial institution to provide financial guarantees, reducing risk for lenders or investors.
The government introduced a guarantee scheme to encourage banks to lend to small businesses.
- (n.) A statutory or contractual mechanism ensuring compensation or fulfillment of obligations if a primary party defaults.
The guarantee scheme protects consumers if the travel company becomes insolvent.
Forms
- guarantee scheme
- guarantee schemes
Related terms
See also
Commentary
Guarantee schemes often require clear statutory or contractual foundation to ensure enforceability; drafters should specify scope, duration, and triggering conditions explicitly.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.