What is Debenture

What is Debenture

Posted on

Hello friends, today we will talk about Debentures and tell you what is Debenture and there is very little lack of information among people and most people do not know about it, most of those people know this information. Who is a commerce student or teacher or who is a big financial savvy or a big investor

So friends, today we will try to give you information about debentures or debentures as an investment in simple and clear words and friends, you will know how important the investment is, if you have read the articles of our blog continuously till now. You must have got a lot of information about investment, then friends understand what is debenture.

Debentures Meaning

Friends, debenture in Hindi means letter of credit! And this simple meaning is debt! Friends, most companies definitely take the help of loans to increase their business, some companies sell their shares to the people, from which they raise money and if the company does not sell its stake, then it takes a loan from the bank or can take a loan from the public. So friends, if that company takes loan from people, then it has to declare through a certificate which we call debenture letter or debenture.

Through this letter of debenture, the company declares or is external that they are taking a loan to increase the business and will return the money to that person along with interest on the stipulated time frame. gives loans

So friends, now you people must have understood that what is debenture, which is a debenture letter that the company issues to every person who gives the company’s loan, in which time period and interest rate along with value amount etc. It happens that the company’s stamp is there etc. Friends, this also happened like an investment where you can earn profit.
Friends, it is decided that the company has taken a loan, it will have to pay interest and the company will also have to return the principal amount whether the company is profit or loss. Even if the company has a loss, the same interest will have to be paid to the company, the debenture is valid for a stipulated time limit.

According to the Companies Act 2013, this limit has now been fixed for 10 years friends, thus debentures or debentures become a safe investment instrument.

some important points

  • Even if the company is on the verge of closure, it has to return the debenture money.
  • Debenture is a certificate on which there is an agreement between the lender and the company.
  • The tax payer can sue the company through letter of credit if the company does not return the money.
  • Debentures are issued for a long period, the time high is 10 years
  • The interest on debentures is fixed, the company has to pay that
  • is an investment for the lender

Friends, you do not get any tax exemption in this, but it is a safe investment, you have the first right on the company’s property when the company is declared insolvent.

I hope you liked the information related to what is Debenture and Debentures Meaning in this article Thank you, have a nice day…..