Definition, Meaning & Synonyms
debenture
Noun
/dɪˈbɛn.tʃər/
Definition
A debenture is a type of debt instrument that is not secured by physical assets or collateral. It is typically issued by companies and governments to raise capital.
Examples
- The company issued a debenture to finance its new project.
- Investors were hesitant to purchase debentures due to the company’s poor financial performance.
- Debentures typically come with a fixed interest rate, making them an attractive investment choice.
Meaning
Debentures are used by companies or governments to borrow money from the public. Investors lend money, and in return, they receive interest payments and the promise of repayment of the principal amount at a later date.
Synonyms
- Bond
- Loan note
- Fixed-income security
