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Guarantees

Guarantee banks assume risks that the house banks of founders do not want to shoulder alone. Here, too, there are attractive public offers.

A person is typing on a laptop and a calculator at the same time.
© Nuttapong punna – stock.adobe.com

Many start-ups often find themselves in the following situation: they want to make a success of their promising business idea, but their bank puts a halt to their plans - because they don't have enough security.

Does that put an end to their dream? Certainly not! Because guarantees can be a substitute for a lack of security. Guarantor banks assume the risk that the customer’s own bank does not wish to assume by itself. As a requirement for applying for a guarantee, the person setting up the business needs to provide evidence of sound financial circumstances, commercial and professional qualifications and (probably) sufficient revenue.

Bürgschaftsbank NRW

The Bürgschaftsbank NRW [a guarantor bank] facilitates loan-financed investments for medium-sized enterprises and freelancers, by granting what is known as a “deficiency guarantee” for 80% of the amount of the loan (up to a maximum of EUR 1.25 million). Normally, a business holder makes an application for a deficiency guarantee to the bank that deals with their investment finance. However, a person can apply directly to the guarantor bank for a guarantee of up to EUR 200,000, without the need to involve their own bank (known as a “bank-free guarantee”) The benefit of this is that with a guarantor bank commitment in place, the business holder can present tangible security to their own bank right at the outset of negotiations. Further information is available at

Bürgschaftsbank NRW

Regional loan guarantees

For loans exceeding a total of EUR 1,562,500.00, regional loan guarantees can be granted. Applications for regional loan guarantees should be made to the PricewaterhouseCoopers (PwC) lending bank. Guidelines and application documentation is available at www.pwc.de – Search term: “Landesbürgschaften Nordrhein-Westfalen” [Regional loan guarantees North Rhine Westphalia].

PwC