A Refundable Performance Guaranty Fund (RPGF), is a surety bond issued by an Institute or a bank to guarantee satisfactory working of the Institute.
Performance guarantee are commonly used, where an owner or investor may require to assure that the working of the Institute will not suffer from its stated goals, or in the case of an unfortunate event (such as insolvency or any other reason of the trust).
The term is also used to denote a collateral deposit of "good faith money", intended to secure future requirements.
Performance guarantee is generally issued as part of a 'Performance and Payment guarantee, where the Payment guarantees that the Trust will pay the staff and material costs they are obliged to.
The Refundable Performance Guarantee Fund (RPGF) shall be refunded to the concerned institution after a period of 8 years but could be carried forward in case of any violation of Norms, conditions and requirement and/or non performance by the institutions and/or complaints against the institutions.
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