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Introduction
Treasury bills are short-term securities issued by the Reserve Bank of India on behalf of the Indian government. They are the government’s primary means of short-term financing. T-Bills are sold at a discount to face value, and the holder receives the face value when the bill matures.
Maturity Period
The maturity time of treasury bills differs from one to the next:
Issuers
The RBI issued this note on behalf of the government.
Eligibility to Invest In The Instruments
T-Bills can be purchased by individuals, businesses, trusts, institutions, and banks.
Transferability
They can be moved about.
Denomination of The Instruments
Rs.25000 as a minimum, and multiples of Rs.25000 afterwards
Introduction
It’s a market where you may buy and sell commercial or trade bills. Discounting of trade bills is also included.
Maturity Period
90 days is the maximum amount of time you can stay.
Issuers
It is drawn by the seller on the buyer of credit goods.
Transferability
They can be transferred with the help of an endorsement.
Denomination of The Instruments
It is dependent on the buyer’s credit purchase.
Introduction
A Certificate of Deposit is a promissory note issued by a bank in the form of a certificate that entitles the bearer to interest. It is comparable to a bank term deposit account.
Maturity Period
From 7 days to 1 year
Issuers
Scheduled commercial banks, except Regional Rural Banks and Local Area Banks, as well as a few All-India Financial Institutions (FIs)
Eligibility to Invest In The Instruments
Individuals, corporations, organizations (including banks and PDs), trusts, funds, and associations, among others. Non-Resident Indians (NRIs) are also permitted to purchase CDs, but only on a non-repatriable basis.
Transferability
CDs can be freely transferred.
Denomination of The Instruments
Minimum-Rs.100,000 and multiples of Rs.100,000 and upwards
Introduction
Commercial papers are unsecured promissory notes issued by companies and financial institutions at a discount from their face value.
Maturity Period
From 7 days to a year at most.
Issuers
Several companies are eligible
Eligibility to Invest In The Instruments
Individuals, banks, other corporate organizations (registered or incorporated in India) and unincorporated bodies, Non-Resident Indians, and Foreign Institutional Investors (FIIs) may invest in CP.
Transferability
Commercial paper can be transferred through endorsement or delivery.
Denomination of The Instruments
It is possible to issue it in denominations of Rs.5 lakhs or multiples of Rs.100000 after that.
Introduction
The call money market is a market where banks’ excess cash are traded. This market allows banks to lend and borrow money for a short period of time.
Maturity Period
From 1 to 14 days
Issuers
Scheduled commercial banks (with the exception of RRBs), co-operative banks (with the exception of Land Development Banks), and Primary Dealers (PDs) are both borrowers and lenders.
Eligibility to Invest In The Instruments
Commercial banks (excluding RRBs), co-operative banks (except Land Development Banks), and primary dealers are all included (PDs).
Transferability
Because the maturity period is so short, there is no need for transferability.
Denomination of The Instruments
It is determined by the borrower’s requirements.
Introduction
The gilt-edged market is a market for government and semi-government securities that are backed by the Reserve Bank of India (RBI).
Maturity Period
The maximum tenure is less than one year.
Issuers
issued by governments such as the federal and state governments, semi-government authorities, municipalities, and so on.
Eligibility to Invest In The Instruments
Banks, primary dealers, insurance companies, mutual funds, overseas portfolio investors, and high-net-worth individuals are all examples of high-net-worth individuals.
Transferability
It is possible to transfer ownership by endorsement.
Denomination of The Instruments
The minimum denomination for central government securities is Rs.10000, and trading is done in multiples of Rs.5 crores. State government securities are traded in multiples of Rs.1.5 crores and have a minimum denomination of Rs.1000.
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