What Is Debenture Loans?


Debentures (or loan stock) exist as an alternative form of investing in a company that is more secure than investing in shares because interest payments must be made by the company and must be paid before dividends. Dividends, in contrast to debentures, are paid at the company's discretion.
Q&A Related to "What Is Debenture Loans"
This is the type of loan which could be converted later into goods or stocks. This permits the company who takes the loan to pay less interest rest then if it was without this option
A debenture is a debt security - a bond, to use general language - that is not secured by a specific asset or lien. An investor holding a debenture has a claim against all of the
Debenture : A type of debt instrument that is not secured by physical asset or collateral.
A provision that was added to the Indian Companies Act of 1956 during an amendment in the year 2000. The provision states that any Indian company that issues debentures must create
1 Additional Answer
Debenture loans are long term loans, usually taken by companies where they agree to pay at a specified future date. The loan is repaid in a fixed rate of interest to the debenture holder annually until maturity. Should the company fail to pay either the interest or principal amount at maturity of the loan; the debenture holders can force the company into liquidation to pay the amount due.
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