LENDING GLOSSARY
PG
Personal Guarantee
An individual's contractual promise to repay a business obligation under specified conditions.
What does PG mean?
An individual's contractual promise to repay a business obligation under specified conditions. Professionals may calculate, document or apply this concept differently depending on the transaction, accounting method, lender policy and governing documents. Borrowers should confirm the precise definition used in any term sheet or agreement.
PG in context
A lender may require the 80% owner to sign a PG for a business term loan.
Why it matters in financing
PG can influence how a lender, investor or advisor evaluates risk, pricing, structure, repayment capacity or transaction economics. It should be considered together with the complete financial picture rather than used alone.
Related lending terms
Educational information only. This definition is general, may not match a particular lender or contract, and is not financial, accounting, tax or legal advice.