2. According to China's "People's Republic of China (PRC) Guarantee Law" (hereinafter referred to as the "Guarantee Law"), legal persons, other organizations or citizens who have the ability to pay off debts on their behalf can act as guarantors. However, state organs may not be guarantors (except loans approved by the State Council to use loans from the government or international economic organizations); Schools, kindergartens, hospitals and other public welfare institutions and social organizations shall not be guarantors; If the branch of an enterprise as a legal person has written authorization from the legal person, it may provide guarantee within the scope of authorization. The Guarantee Law also stipulates that the guarantor and the creditor shall conclude a guarantee contract in writing, which shall include: (1) the type and amount of the principal creditor's rights to be guaranteed; (2) the time limit for the debtor to perform the debt; (3) the method of guarantee; IV. Scope of guarantee. 5] Guarantee period; [6] Other matters that both parties think need to be agreed.
In order to obtain bank loans smoothly, enterprises should choose those legal persons or citizens with strong strength and good reputation as loan guarantors. If financial institutions such as banks can act as guarantors of enterprises, the effect will be more ideal, and it will be easier for borrowing enterprises to obtain bank loans.