A partial credit guarantee (PCG) represents a promise of full and timely debt service payment up to a predetermined amount. Typically, the sum that IFC pays out under the guarantee covers creditors irrespective of the cause of default. The guarantee amount may vary over the life of the transaction based on the borrower's expected cash flows and creditors' concerns regarding the stability of these cash flows.
IFC tailors guarantees to meet the needs of both borrower and creditors. They are structured to reduce the probability of default of the debt instrument and increase the recovery if default occurs. In general, IFC's objective is to offer the minimum amount of guarantee necessary to facilitate a successful transaction.
For more details on partial credit guarantees description, please click here.
For details on selected partial credit guarantee transactions, please see the following fact sheets: