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A demand guarantee (otherwise called an independent guarantee, autonomous guarantee or first demand guarantee) is an irrevocable undertaking issued by the Guarantor upon the instructions of the Applicant to pay the Beneficiary any sum that may be demanded by that Beneficiary up to a maximum amount determined in the Guarantee, upon presentation of a demand complying with the terms of that Guarantee.

The Guarantor of course being the Issuing Bank. The Applicant being the customer of the Issuing Bank. The Beneficiary is the receiver of the Guarantee (either a person, corporation or receiving bank).