The main characteristics or features of debentures can be studied as follows:
1. A Written Promise
It is an instrument of loan or debt in written format..
2. Fixed Value
It has a fixed face value like $20. $50, $100 etc.
3. Fixed Maturity Period
Debenture has a fixed maturity period.
4. Long Term Source
It is a long term source of financing.
5. No Voting Right
Debenture holders are not the owners of the company. So, they do not have voting right.
Also Read:
Also Read:
6. First Priority
Debenture holders get first priority at the time of repayment or liquidation.
7. Fixed Interest Rate
It has a fixed rate of interest which is paid annually.
