| |
| What is Debenture?
Debenture also called as unsecured bond. It's a long time loan which governments and corporations make with our putting up anything for collateral only their word or trustworthiness. For this reason it's more risky then the usual bond.
In common term it can be called as an I.O.U. where the only insurance that you pay the creditor back is your word. A perfect example is a treasury bond, the government issues treasury bonds to secure capital. If the government can't pay back the buyers then it can print out money to settle the problem, now this would hurt the economy but the “loaners” would be satisfied. | | | | |
|
| |
