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Glossary Mutual Fund / Term

Debentures

Debentures are a type of debt-instrument with a long term horizon. They are unsecured in nature as there are no collaterals, liens or hypothecation. It allows the issuer to borrow funds from the public.
The debenture holders are treated as creditors for the company issuing the debenture. Debentures have a pre-defined maturity period and also state in the beginning the mode of interest payment to the holders.
There can be different categories of debentures depending upon their convertibility, security, redemption and registration.

Permanent link Debentures - Creation date 2020-05-23


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