Tracks Performance Bank Guarantee + ancillary BGs (advance, retention) — issuance, validity, renewal, partial release at completion + DLP, final release at warranty end.
Performance BG: SBI BG #2026-XXX, ₹4.5 cr (10 % of ₹45 cr contract). Issued 28-Apr-2026, validity 31-Dec-2027. Substantial completion expected: 30-Sep-2027. Schedule: 50 % release at SC, balance at DLP end (30-Sep-2029). No encashment events.
Performance Bank Guarantees (PBG) are typically 5-10% of contract value, deposited by the contractor at project start, valid through construction + Defect Liability Period (DLP). For a ₹100 crore project, that's ₹5-10 crore tied up — a significant working capital commitment.
BGs have fixed validity periods (typically 12-36 months at issuance). When the project schedule extends beyond original validity, the BG must be renewed or replaced before expiry. Letting a BG expire = no guarantee = client demands fresh BG immediately + contractor faces working-capital crisis.
The PBG Tracker is the project-level log of every BG: issuing bank, amount, validity start + end, type, beneficiary, expiry date, renewal status, release date.
Per-BG entry: - BG instrument number - Issuing bank + branch - Beneficiary (client / employer legal name) - Amount (in figures + words) - BG type (conditional / unconditional / on-demand) - Issue date + validity start + validity end - Days remaining until expiry - Renewal status (Active / Due / Renewed / Expired / Released) - Renewal notice issued date - Renewed BG instrument number - Release / cancellation date
Renewal lead time: - 90 days before expiry: alert PMC - 60 days: contractor formally notifies bank for renewal - 30 days: contractor must have replacement BG instrument ready - 0 days: original BG expires; replacement must be in effect
Release conditions (per contract): - 50% release at substantial completion (typically 12 months post handover) - 50% release at DLP expiry (typically 24-36 months post handover) - Full release: when all defects rectified + client satisfied
1. BG expired before renewal — client invokes for full amount before contractor can secure replacement; financial crisis. 2. Conditional BG — bank refuses to pay on client's invocation; legal disputes; renders BG ineffective. 3. Wrong beneficiary — BG names parent company instead of contractual subsidiary; client cannot invoke. 4. Bank refuses renewal — contractor's financial position deteriorated; bank withdraws BG facility; client demands fresh BG. 5. Currency mismatch — international project BG in foreign currency; rupee depreciation affects amount. 6. No tracker — multiple BGs lost; renewals missed; project credibility damaged. 7. Counter-guarantee complications — contractor's parent guarantees BG to bank; parent's credit affects BG validity. 8. Release delay — substantial completion certificate issued but client doesn't release BG; contractor's funds blocked indefinitely. 9. Mismatched validity — BG validity shorter than contract duration; gap between BG expiry + project completion.
Companion PMC formats: - Performance BG Submission Letter (FMT-TND-015) — original submission record - Contract Amendment Log (PMC-BIL-LOG-004) — for BG-related amendments - Deductions Register (PMC-BIL-REG-002) — BG vs retention coordination - Letter of Award (FMT-TND-014) — original BG terms reference
Legal + regulatory: - Indian Contract Act 1872 — Section 126 (contracts of guarantee) - RBI Master Direction on Letter of Credits + BGs — banking regulations - FIDIC General Conditions — Clause 4.2 (Performance Security) - NHAI / MoRTH / CPWD standard contracts — Indian government-specific PBG terms