Debenture Hide Amount Field For Free

The definition of a debenture is a long-term bond issued by a company, or an unsecured loan that a company issues without a pledge of assets. An interest-bearing bond issued by a power company is an example of a debenture.

In a sense, all debentures are bonds, but not all bonds are debentures. Whenever a bond is unsecured, it can be referred to as a debenture.In British usage, a debenture is a bond that is secured by company assets.

In debenture, the public lends its money to the company in return for a certificate promising a fixed rate of interest. In loans, the lending institutions are banks and other financial institutions.

A debenture is a debt instrument which is not backed by any specific security; instead the credit of the company issuing the same is the underlying security.Bonds, however, in India are typically issued by financial institutions, government undertakings and large companies.

Secured NCDs: Secured NCDs are considered safer of the two kinds as their issues are backed by the assets of the company. In the event of the company failing to pay on time, then the investors can recover their dues by liquidating the company's assets. However, the interest offered on NCDs is low.

A debenture is a type of bond or other debt instrument that is unsecured by collateral. Since debentures have no collateral backing, debentures must rely on the creditworthiness and reputation of the issuer for support. Both corporations and governments frequently issue debentures to raise capital or funds.

A debenture is an agreement between a business and its lender enabling the lender to put a charge on the business's assets.This gives lenders the security of knowing they'll be able to recover the money they're owed if the business can't repay the loan.