Accountancy, asked by harvinder52, 11 months ago

what do you mean by debentures issued as collateral security

Answers

Answered by rslekshmi08

Issue of Debentures as a Collateral Security. Collateral security means supporting security for a loan which can be realized by the lender in case of default in repayment of the original loan. Sometimes, companies issue their own debentures as a collateral security for a loan availed by it.

Answered by arajiv789

Answer:

Explanation:

Collateral means secondary. Thus,collateral security refers to secondary or supporting security for a loan. In case, the borrower fails to pay the original loan amount on the due date , the lender can sell the collateral security to realize the amount of loan.

Debentures are issued for a limited time and repaid in full.

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