Initial and final guarantees in government tenders: what you need to know
A simple explainer of tender guarantees, their amounts, when they are forfeited — and when SMEs are exempt.
Guarantees protect the government entity and ensure bidders are serious. Understanding them well avoids disqualification or losing your money.
The initial guarantee
Submitted with the bid as a bank guarantee, usually 1%–2% of the bid value and valid for at least 90 days. It is forfeited if you withdraw before expiry or refuse to sign at award.
The final guarantee
Provided by the winner within the set period after award (often 15 days), at 5% of the contract value, valid until the contract ends and the work is accepted.
SME exemption
Many SMEs are exempt from the initial guarantee and may get reduced final-guarantee requirements. Confirm your classification on the Monsha’at platform to benefit.
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