This guide aims at increasing member’s awareness and understanding on the rights and liabilities ofGuarantors before they commit to guaranteeing someone else’s debt.

Who is a Guarantor?
A “guarantor” is a person who gives his movable and immovable property as security and/or a personwho signs a contract of guarantee and/or promises to pay any outstanding debts if the principal debtor/sor borrower/s is/are unable to honour his/her/their obligations.

What is a contract of guarantee?
An agreement whereby the guarantor is liable to the Society to settle the outstanding debts of theborrower member in case he fails to pay back the credit facility.As a Guarantor, you may:
• seek independent legal advice prior to signing the contract of guarantee to ensure that youunderstand your commitments and the potential consequences that may arise subsequently, eventhough you may be a related party with the business concern of the borrower in terms ofshareholding or otherwise;
• request the Society for a copy of the contract of guarantee that you will sign;
• make enquiries from the Mauritius Credit Information Bureau (MCIB) on information which has beenregistered in your name by any bank;
• make complaints if you feel aggrieved by the acts/omissions committed by any bank. Banks shallguide guarantors on their respective complaints procedures;
• request for a statement of account at any time during the credit facility period. The bank shall providethe guarantor with a copy of the statement;
• obtain from the Society, prior to giving your guarantee, information on the total indebtedness of theborrower towards the Society.

Guarantors’ liabilities
The Society will:
• explain to you the responsibilities that may devolve or consequences that may arise on you in caseof default of the borrower as well as the type of guarantee you are contracting;
• recommend you to read and understand the contract of guarantee before executing same;
• advise you on the extent of your liability, which may include accrued interest and will be as specifiedin the contract of guarantee;
• advise and caution that you may be held liable for the liabilities of the borrower in accordance withthe terms of the contract of guarantee or may be rendered liable under a guarantee if the borroweris in default of any payment to the bank and/or the bank makes a demand on the guarantor;
• exercise its security as it deems fit, in case the borrower is rendered insolvent or death occurs.