What are the various types of debentures?

Debentures may be of the following kinds:-

1. Secured debenture
2. Unsecured debenture
3. Redeemable debenture
4. Perpetual debenture
5. Bearer debenture
6. Registered debenture

1. Secured Debenture: The debenture which are secured by a mortgage of the whole or part of the assets of the company are called secured debenture.
2. Unsecured or Naked Debenture: Debentures which are issued without any charge on the assets of the company are called secured debentures. The holders of these debentures do not have any security for the repayment of principal or interest thereon.
3. Redeemable Debenture: The debentures which are issued for a specified period of time are redeemable debentures.

On expiry of the specified time the company has the right to pay back the debenture holders and have its properties release from mortgage or charge.

4. Perpetual Debenture: A debenture which has no clause as to the payment of which contains a clause that it shall not be paid back is called perpetual debentures.
5. Bearer debenture: The debentures which are transferred by mere delivery and no stamp duty is payable on the transfer is called bearer debentures.
6. Registered Debenture: The debenture which are payable to the person whose names appear in the register of Debenture holder is called registered debentures.