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In corporate finance, a debenture is a medium to long-term debt instrument used by large companies to borrow money, at a fixed rate of interest.

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A debt instrument used by the compnay to raise the capital or to raise money at specified rate of interest is called as debentures.

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Debenture is a  long term security issued by company to borrow money. The rate of interest on debentures is fixed and they are unsecured in nature i.e. not secured by any physical assets or collateral.

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Debenture is a debt instrument issued by a company / corporate - they are backed by the assets of the company as security / collateral. They carry a fixed rate of interest and can be issued and redeemed at a discount / premium to their issue price.

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A debt security, issued by a government or large company, that is not secured by an asset or lien, but rather by the all issuer's assets not otherwise secured. That is, a debenture carries no collateral and is considered unsecured; in case of bankruptcy, the debenture holder is considered a general creditor. A debenture can be traded, and the term is often interchangeable with a bond.Debentures issued by governments are considered risk-free.

There are convertiable into equity also after a particular period of time.

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DEFINITION of 'Debenture' A type of debt instrument that is not secured by physical assets or collateral. Debentures are backed only by the general creditworthiness and reputation of the issuer. Both corporations and governments frequently issue this type of bond in order to secure capital.

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