Entri Blog
No Result
View All Result
Sunday, December 3, 2023
  • State PSC
    • Kerala PSC
      • Kerala PSC Exams
      • Kerala PSC Notification
      • Kerala PSC Exam Calender
      • Kerala PSC Previous Question papers
      • KAS Exam
      • KAS Previous Year Question papers
      • Kerala PSC VEO Notification
      • Kerala Police SI
      • Kerala PSC LDC Notification
      • Kerala PSC LP/UP Assistant
      • Kerala PSC Village Field Assistant Notification
      • Kerala PSC LD Typist Notification
      • Kerala PSC Food Safety Officer
      • Kerala PSC Excise Inspector Notification
      • Kerala PSC BDO Notification
      • Kerala PSC CPO Notification
      • Kerala PSC LGS Notification
    • TNPSC
    • APPSC
    • TSPSC
    • BPSC
    • Karnataka PSC
    • MPPSC
    • UPPSC
  • Banking
    • IBPS PO Notification
    • IBPS Clerk Notification
    • SBI PO Notification
    • SBI Clerk Notification
    • SBI SO Notification
    • SBI Apprentice Notification
    • Canara Bank PO Notification
    • Indian Bank PO Notification
    • RBI Assistant Notification
    • RBI Office Attendant Notification
    • IBPS RRB Notification
    • IBPS RRB Office Assistant Notification
  • Skilling
    • Coding
    • Spoken English
    • Stock Marketing
  • Courses
    • Data Science Course
      • Data Science Malayalam
      • Data Science Training in Kochi
      • Data Science Training in Trivandrum
      • Data Science Course in Calicut
      • Data Science Training in Thrissur
    • Full Stack Developer Course
      • Full Stack Development Malayalam
      • Full Stack Development Hindi
      • Full Stack Development Tamil
      • Full Stack Development Telugu
      • Full Stack Development Kannada
    • Stock Market Course
      • Stock Market Course in Malayalam
      • Stock Market Course in Tamil
      • Stock Market Course in Kannada
      • Options Trading Course
    • Spoken English Course
      • Spoken English Course in Malayalam
      • Spoken English Course in Hindi
      • Spoken English Course in Telugu
      • Spoken English Course in Tamil
      • Spoken English Course in Kannada
    • Python Programming Course
    • Quantity Surveying Course
    • Performance Marketing Course
    • Practical Accounting Course
      • Tally Course
      • Taxation Course
      • UAE Accounting
      • GST Course
    • Mern Stack Developer Course
      • Full Stack Developer Course in Kochi
      • Full Stack Developer Course in Trivandrum
      • Full Stack Developer Course in Calicut
      • Full Stack Developer Course in Pune
      • Full Stack Developer Course in Bangalore
      • Full Stack Developer Course in Hyderabad
      • Full Stack Developer Course in Chennai
      • Full Stack Developer Course in Indore
      • Full Stack Developer Course in Jaipur
      • Full Stack Developer Course in Coimbatore
    • Other Courses
      • Montessori Teacher Training
      • MEP Course
      • German Language Course
      • OET Coaching
      • Nurses Recruitment Abroad
      • Digital Marketing Training
      • ChatGPT Course
      • Forex Trading Course
      • Yoga Teacher Training Course
      • Oil and Gas Course
  • Others
    • Railway
    • SSC
    • GATE
    • MAT
    • KMAT
    • UPSC
    • TET
      • APTET
      • CTET
      • DSSSB
      • Karnataka TET
      • Kerala TET
      • KVS
      • MPTET
      • SUPER TET
      • TNTET
      • TSTET
      • UPTET
  • Aptitude Questions
  • Test Prep
    • PSC Coaching
      • KPSC Degree Level Exam Preparation
      • Kerala PSC 12th Level Exam Preparation
      • Kerala PSC 10th Level Exam Preparation
      • KAS Coaching
      • Kerala PSC LDC Coaching
      • Kerala PSC Fireman Coaching
      • KSFE Assistant Exam Preparation
      • Kerala PSC SI Exam Coaching
      • KTET Coaching
      • SET Coaching
      • Kerala PSC Lecturer in Diet Coaching
      • Khadi Board LDC Exam Preparation
      • LP/UP Assistant Exam Coaching
      • HSST Exam Preparation
      • HSA Exam Preparation
      • EMRS Coaching
      • University LGS Exam Preparation
      • University Assistant Exam Coaching
    • IELTS Training Online
    • Bank Exam Coaching Online
      • IBPS SO Online Coaching
      • IBPSC PO Online Coaching
      • IBPSC Clerk Online Coaching
      • SBI PO Coaching
      • SBI Clerk Online Coaching
      • RBI Grade B Coaching
      • RBI Assistant Coaching
    • UPSC Online Coaching
    • SSC Online Coaching
      • SSC JE Online Coaching
    • RRB JE Online Coaching
      • RRB Exams Coaching
    • CAT Online Coaching
    • GATE Online Coaching
Spoken English
Entri Blog
  • State PSC
    • Kerala PSC
      • Kerala PSC Exams
      • Kerala PSC Notification
      • Kerala PSC Exam Calender
      • Kerala PSC Previous Question papers
      • KAS Exam
      • KAS Previous Year Question papers
      • Kerala PSC VEO Notification
      • Kerala Police SI
      • Kerala PSC LDC Notification
      • Kerala PSC LP/UP Assistant
      • Kerala PSC Village Field Assistant Notification
      • Kerala PSC LD Typist Notification
      • Kerala PSC Food Safety Officer
      • Kerala PSC Excise Inspector Notification
      • Kerala PSC BDO Notification
      • Kerala PSC CPO Notification
      • Kerala PSC LGS Notification
    • TNPSC
    • APPSC
    • TSPSC
    • BPSC
    • Karnataka PSC
    • MPPSC
    • UPPSC
  • Banking
    • IBPS PO Notification
    • IBPS Clerk Notification
    • SBI PO Notification
    • SBI Clerk Notification
    • SBI SO Notification
    • SBI Apprentice Notification
    • Canara Bank PO Notification
    • Indian Bank PO Notification
    • RBI Assistant Notification
    • RBI Office Attendant Notification
    • IBPS RRB Notification
    • IBPS RRB Office Assistant Notification
  • Skilling
    • Coding
    • Spoken English
    • Stock Marketing
  • Courses
    • Data Science Course
      • Data Science Malayalam
      • Data Science Training in Kochi
      • Data Science Training in Trivandrum
      • Data Science Course in Calicut
      • Data Science Training in Thrissur
    • Full Stack Developer Course
      • Full Stack Development Malayalam
      • Full Stack Development Hindi
      • Full Stack Development Tamil
      • Full Stack Development Telugu
      • Full Stack Development Kannada
    • Stock Market Course
      • Stock Market Course in Malayalam
      • Stock Market Course in Tamil
      • Stock Market Course in Kannada
      • Options Trading Course
    • Spoken English Course
      • Spoken English Course in Malayalam
      • Spoken English Course in Hindi
      • Spoken English Course in Telugu
      • Spoken English Course in Tamil
      • Spoken English Course in Kannada
    • Python Programming Course
    • Quantity Surveying Course
    • Performance Marketing Course
    • Practical Accounting Course
      • Tally Course
      • Taxation Course
      • UAE Accounting
      • GST Course
    • Mern Stack Developer Course
      • Full Stack Developer Course in Kochi
      • Full Stack Developer Course in Trivandrum
      • Full Stack Developer Course in Calicut
      • Full Stack Developer Course in Pune
      • Full Stack Developer Course in Bangalore
      • Full Stack Developer Course in Hyderabad
      • Full Stack Developer Course in Chennai
      • Full Stack Developer Course in Indore
      • Full Stack Developer Course in Jaipur
      • Full Stack Developer Course in Coimbatore
    • Other Courses
      • Montessori Teacher Training
      • MEP Course
      • German Language Course
      • OET Coaching
      • Nurses Recruitment Abroad
      • Digital Marketing Training
      • ChatGPT Course
      • Forex Trading Course
      • Yoga Teacher Training Course
      • Oil and Gas Course
  • Others
    • Railway
    • SSC
    • GATE
    • MAT
    • KMAT
    • UPSC
    • TET
      • APTET
      • CTET
      • DSSSB
      • Karnataka TET
      • Kerala TET
      • KVS
      • MPTET
      • SUPER TET
      • TNTET
      • TSTET
      • UPTET
  • Aptitude Questions
  • Test Prep
    • PSC Coaching
      • KPSC Degree Level Exam Preparation
      • Kerala PSC 12th Level Exam Preparation
      • Kerala PSC 10th Level Exam Preparation
      • KAS Coaching
      • Kerala PSC LDC Coaching
      • Kerala PSC Fireman Coaching
      • KSFE Assistant Exam Preparation
      • Kerala PSC SI Exam Coaching
      • KTET Coaching
      • SET Coaching
      • Kerala PSC Lecturer in Diet Coaching
      • Khadi Board LDC Exam Preparation
      • LP/UP Assistant Exam Coaching
      • HSST Exam Preparation
      • HSA Exam Preparation
      • EMRS Coaching
      • University LGS Exam Preparation
      • University Assistant Exam Coaching
    • IELTS Training Online
    • Bank Exam Coaching Online
      • IBPS SO Online Coaching
      • IBPSC PO Online Coaching
      • IBPSC Clerk Online Coaching
      • SBI PO Coaching
      • SBI Clerk Online Coaching
      • RBI Grade B Coaching
      • RBI Assistant Coaching
    • UPSC Online Coaching
    • SSC Online Coaching
      • SSC JE Online Coaching
    • RRB JE Online Coaching
      • RRB Exams Coaching
    • CAT Online Coaching
    • GATE Online Coaching
No Result
View All Result
Entri Blog
Spoken Eng
  • HTML Tutorial
  • DSA Tutorials
  • Tutorials in Hindi
    • HTML Tutorial for Beginners in Hindi
    • Python Tutorial for Beginners in Hindi
    • GIT and GITHUB Tutorial for Beginners in Hindi
  • Tutorials in Tamil
    • JavaScript Tutorial in Tamil
  • Tutorials in Telugu
    • HTML Tutorial For Beginners in Telugu
    • CSS Tutorial for Beginners in Telugu
    • Bootstrap Tutorial for Beginner in Telugu
  • Tutorials in Kannada
    • HTML Tutorial For Beginners in Kannada
banner top article banner top article
Home Articles

Rupee Denominated Bonds

by Shibani Ghosh
October 7, 2021
in Articles, General Knowledge
Rupee Denominated Bonds
Share on FacebookShare on WhatsAppShare on Telegram

Rupee Denominated Bond is commonly known as Masala Bonds. This bond was first introduced in the year 2014 in India by IFC that is, International Finance Corporation. It was issued for funding various infrastructure projects by the IFC. Masala Bonds are used outside of India to raise money. It should be noted that it is in Indian currency therefore when the rate of the rupee falls, the investor will have to bear the loss. 

When it comes to financing, a bond denotes a loan. Here is what you should know – the one who issues the bond is called the borrower or the debtor and the one who owns the bond is called the creditor or the lender. Also, the coupon is the interest while either the debtor or the creditor has access to external funds for long-term investments.

In short, any investor who wants to invest in the assets of India should use these bonds. These investor’s securities market regulator should be a member of the International Organisation of Securities Commission.

Preparing for a GK exam? Take a test on Entri now!

Characteristics Of Masala Bonds

It is crucial to first understand the features of the bond and the various terminologies related to it like – bond yield, coupon amount, maturity amount, credit quality and market price.

  • For these bonds, the investor can belong to a country that has a membership of the Financial Action Task Force or the security market regulator must be from the International Organisation of Securities Commission.
  • Investors can be from outside India and can invest in Indian assets.
  • Like every bond, this has a principal amount also known as the face, par or nominal amount. It is this amount in which the issuer pays the interest. 
  • The maturity date refers to when the issuer pays the total amount of money. The tenure is the length of time between the agreement day to the maturity date. 
  • A coupon is the interest rate that is paid by the issuer to the holder.
  • The market price of this bond depends on the currency, amount, and timing of the interest payments. 

Benefits Of Masala Bonds

The best thing about Masala Bonds is that both the borrower and investor get to earn benefits. Here are some of the benefits they both can get –

Advantages for the investors are:

  • Investors benefit from it because of the high interest it provides.
  • Foreign investors can believe better in the Indian economy because of the Masala Bonds.
  • The capital gains that are received from the rupee denomination are not included in the tax.
  • If the rupee appreciates at the time of maturity, it benefits the investor.

Advantages for the borrowers are:

  • Since there is no currency risk in this bond, the borrower can rest assured of currency fluctuations.
  • The insurance of the Rupee Denominated Bonds is in Indian currency making it easier for the borrowers.
  • These bonds give an option of moving huge amounts of funds easily.
  • When these bonds are issued outside India, the rate is 7% interest. This way the borrowers can cut down on their costs.
  • Borrowers can get a huge number of investors since they are issued in the offshore market.

Take a General Knowledge test today!

Limitations of Masala Bond

  • Reserve Bank of India has taken steps that limit the benefit of  Masala Bonds. There have been rate cuts at particular times which makes the Rupee Denominated Bonds not that impressive to the investors. 
  • The money that is collected from Masala Bonds can be used only in fixed places which is another reason for not being that appealing.
  • Another challenge is that financing through Masala Bonds is unsustainable. Thus, investors should be alert when enduring currency risks from markets that are emerging. 

Get prepared for the GK exam with Entri!

Key Takeaways

So now it is clear that Indian entities have the freedom to issue masala bonds outside of India. The private entities and the government can try issuing these bonds. These bonds are debt instruments that help in raising money in local currency.

It is very easy to access the Entri App to prepare for various examinations. The app provides guidance through videos and mock test papers to check one’s progress.

Share62SendShare

Shibani Ghosh

Pouring out my thoughts through words!

Related Posts

Kerala PSC ICDS Supervisor Exam Date 2023-2024
Articles

Kerala PSC ICDS Supervisor Exam Date 2023-2024

November 29, 2023
Top 10 Revit Interview Questions
Articles

Top 10 Revit Interview Questions & Answers (2024 Update)

November 29, 2023
MEP Engineer 2024
Articles

How to Become an MEP Engineer 2024: Experts Guide

November 29, 2023
Next Post
RBI Grade B Exam Analysis 2022 - All Shift Analysis

RBI Grade B Exam Analysis 2022 - All Shift Analysis

Latest Posts

  • How To Learn Stock Trading In 2024: 10 Great Ways To Do It
  • Top 7 Strategies For Growing A Small Trading Account
  • Accountant vs Actuary: Which is Better for You?
  • Quantity Surveyor Salaries in UAE
  • Finance and Accounting Interview Preparation for Freshers Tips to Succeed!

Trending Posts

  • states of india and their capitals and languages

    List of 28 States of India and their Capitals and Languages 2023 – PDF Download

    152231 shares
    Share 60890 Tweet 38056
  • List of Government Banks in India 2023: All you need to know

    65505 shares
    Share 26202 Tweet 16376
  • Kerala Bank Assistant Manager Syllabus 2023: Download Expected Syllabus PDF

    541 shares
    Share 216 Tweet 135
  • KSDA Recruitment 2023 Apply Online for 9264 FDA SDA Posts – Qualification

    9378 shares
    Share 3751 Tweet 2345
  • TNPSC Group 2 Posts and Salary Details 2022

    39986 shares
    Share 15994 Tweet 9997

Courses

  • Data Science Course
  • Full Stack Developer Course
  • Data Science Course in Malayalam
  • Full Stack Developer Course in Malayalam
  • Full Stack Developer Course in Hindi
  • Full Stack Developer Course in Tamil
  • Full Stack Developer Course in Telugu
  • Full Stack Developer Course in Kannada
  • Python Programming Course
  • Practical Accounting Course
  • Quantity Surveying Course
  • Stock Market Course
  • Stock Market Course in Malayalam
  • Stock Market Course in Tamil
  • Stock Market Course in Kannada
  • Options Trading Course

Company

  • Become a teacher
  • Login to Entri Web

Spoken English Courses

  • Spoken English Course
  • Spoken English Course in Malayalam
  • Spoken English Course in Hindi
  • Spoken English Course in Tamil
  • Spoken English Course in Telugu
  • Spoken English Course in Kannada
  • Spoken English Course for Housewives
  • Spoken English Course for Working Professionals
  • Spoken English Course for School Students
  • Spoken English Course for College Students
  • Spoken English Course for Job Seekers
  • AI Powered Spoken English Course

Quick Links

  • Aptitude Questions
  • Articles
  • Videos
  • Entri Daily Quiz Practice
  • Current Affairs & GK
  • News Capsule – eBook
  • Preparation Tips
  • Kerala PSC Gold
  • Entri Skilling
  • Kerala PSC

Other Courses

  • OET Coaching Classes
  • Nurse Recruitment Abroad
  • Forex Trading Course
  • Montessori Teachers Training
  • Performance Marketing Course
  • German Language Course
  • MEP Course
  • Oil and Gas Course Online
  • Yoga Teacher Training Course
  • Digital Marketing Course
  • German Language A1 Course
  • German Language A2 Course
  • German Language B1 Course
  • German Language B2 Course

Popular Exam

  • IBPS Exam
  • SBI Exam
  • Railway RRB Exam
  • Kerala PSC
  • Tamil Nadu PSC
  • Telangana PSC
  • Andhra Pradesh PSC
  • MPPSC
  • UPPSC
  • Karnataka PSC
  • Staff Selection Commission Exam

© 2023 Entri.app - Privacy Policy | Terms of Service

No Result
View All Result
  • State PSC
    • Kerala PSC
      • Kerala PSC Exams
      • Kerala PSC Notification
      • Kerala PSC Exam Calender
      • Kerala PSC Previous Question papers
      • KAS Exam
      • KAS Previous Year Question papers
      • Kerala PSC VEO Notification
      • Kerala Police SI
      • Kerala PSC LDC Notification
      • Kerala PSC LP/UP Assistant
      • Kerala PSC Village Field Assistant Notification
      • Kerala PSC LD Typist Notification
      • Kerala PSC Food Safety Officer
      • Kerala PSC Excise Inspector Notification
      • Kerala PSC BDO Notification
      • Kerala PSC CPO Notification
      • Kerala PSC LGS Notification
    • TNPSC
    • APPSC
    • TSPSC
    • BPSC
    • Karnataka PSC
    • MPPSC
    • UPPSC
  • Banking
    • IBPS PO Notification
    • IBPS Clerk Notification
    • SBI PO Notification
    • SBI Clerk Notification
    • SBI SO Notification
    • SBI Apprentice Notification
    • Canara Bank PO Notification
    • Indian Bank PO Notification
    • RBI Assistant Notification
    • RBI Office Attendant Notification
    • IBPS RRB Notification
    • IBPS RRB Office Assistant Notification
  • Skilling
    • Coding
    • Spoken English
    • Stock Marketing
  • Courses
    • Data Science Course
      • Data Science Malayalam
      • Data Science Training in Kochi
      • Data Science Training in Trivandrum
      • Data Science Course in Calicut
      • Data Science Training in Thrissur
    • Full Stack Developer Course
      • Full Stack Development Malayalam
      • Full Stack Development Hindi
      • Full Stack Development Tamil
      • Full Stack Development Telugu
      • Full Stack Development Kannada
    • Stock Market Course
      • Stock Market Course in Malayalam
      • Stock Market Course in Tamil
      • Stock Market Course in Kannada
      • Options Trading Course
    • Spoken English Course
      • Spoken English Course in Malayalam
      • Spoken English Course in Hindi
      • Spoken English Course in Telugu
      • Spoken English Course in Tamil
      • Spoken English Course in Kannada
    • Python Programming Course
    • Quantity Surveying Course
    • Performance Marketing Course
    • Practical Accounting Course
      • Tally Course
      • Taxation Course
      • UAE Accounting
      • GST Course
    • Mern Stack Developer Course
      • Full Stack Developer Course in Kochi
      • Full Stack Developer Course in Trivandrum
      • Full Stack Developer Course in Calicut
      • Full Stack Developer Course in Pune
      • Full Stack Developer Course in Bangalore
      • Full Stack Developer Course in Hyderabad
      • Full Stack Developer Course in Chennai
      • Full Stack Developer Course in Indore
      • Full Stack Developer Course in Jaipur
      • Full Stack Developer Course in Coimbatore
    • Other Courses
      • Montessori Teacher Training
      • MEP Course
      • German Language Course
      • OET Coaching
      • Nurses Recruitment Abroad
      • Digital Marketing Training
      • ChatGPT Course
      • Forex Trading Course
      • Yoga Teacher Training Course
      • Oil and Gas Course
  • Others
    • Railway
    • SSC
    • GATE
    • MAT
    • KMAT
    • UPSC
    • TET
      • APTET
      • CTET
      • DSSSB
      • Karnataka TET
      • Kerala TET
      • KVS
      • MPTET
      • SUPER TET
      • TNTET
      • TSTET
      • UPTET
  • Aptitude Questions
  • Test Prep
    • PSC Coaching
      • KPSC Degree Level Exam Preparation
      • Kerala PSC 12th Level Exam Preparation
      • Kerala PSC 10th Level Exam Preparation
      • KAS Coaching
      • Kerala PSC LDC Coaching
      • Kerala PSC Fireman Coaching
      • KSFE Assistant Exam Preparation
      • Kerala PSC SI Exam Coaching
      • KTET Coaching
      • SET Coaching
      • Kerala PSC Lecturer in Diet Coaching
      • Khadi Board LDC Exam Preparation
      • LP/UP Assistant Exam Coaching
      • HSST Exam Preparation
      • HSA Exam Preparation
      • EMRS Coaching
      • University LGS Exam Preparation
      • University Assistant Exam Coaching
    • IELTS Training Online
    • Bank Exam Coaching Online
      • IBPS SO Online Coaching
      • IBPSC PO Online Coaching
      • IBPSC Clerk Online Coaching
      • SBI PO Coaching
      • SBI Clerk Online Coaching
      • RBI Grade B Coaching
      • RBI Assistant Coaching
    • UPSC Online Coaching
    • SSC Online Coaching
      • SSC JE Online Coaching
    • RRB JE Online Coaching
      • RRB Exams Coaching
    • CAT Online Coaching
    • GATE Online Coaching

© 2023 Entri.app - Privacy Policy | Terms of Service