INNOVATIVE FINANCE

Procurement guarantees

In July 2020, we agreed to provide a procurement guarantee to UNICEF to support the global children’s charity to increase and accelerate its procurement of COVID-19  medical supplies.

What is a procurement guarantee?

MedAccess’ procurement guarantees enable procurers to enter into purchasing agreements that would otherwise have been out of reach due to individual organisations’ procurement and disbursement rules.

MedAccess enters into an agreement with a procurer to support its procurement or market shaping activity. A call can be made by the procurer if there is a shortfall in demand for the product or products covered by the guarantee.

Why might a procurement guarantee be needed?

Major procurement institutions have legal or technical requirement that sometimes limit their ability to disburse their funding in a timely manner. Procurement guarantees bridge the gap between international procurers’ funding commitments and disbursement for commodity purchases.

What are the benefits of a procurement guarantee?

Procurement guarantees enable procurers to enter into long-term agreements with manufacturers, securing allocations on preferential terms.

Purchasers benefit from the terms agreed upon by the procurers and the manufacturers in the form of improved value for money, reduced lag time, and quality assurance on purchased products.

Patients benefit from faster and wider availability of affordable high-quality health commodities.