A credit guaranty security and pledge agreement is one that is entered into between two parties where one is the borrower and the other is the lender. The borrower has to provide a guarantor, a security or a pledge for securing the credit from the lender. This kind of agreement of borrowing is common in businesses that are engaged in manufacturing and production operations.

The lender provides credit facility to the borrower when there is guarantee for the amount lent either in the form of security or pledge of goods or valuables in order to guarantee recovery of the amount lent to the borrower. The agreement provides details of credit that has been offered, the security provided, the guarantor details, the securities that have been pledged with the lender and other terms that have to be agreed by the borrower. The agreement has to be signed by the borrower on a legal stamp document and dated.

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