Certificate of Deposit
👉This is debt instrument similar to commercial paper, but issued by Banks or other eligible financial institution.
👉CD is a negotiable instrument and generally bear interest rates higher than regular deposits of the bank.
👉Amount : Min 1 lac and multiple thereof, no maximum
👉Maturity : can range between 7 days and 1 year from date of issue
👉However FIs can issue CDs for (1-3 year)
CDs may be issued at a discount on face value
Bank have to maintain CRR and SLR on the issued price of CDs
👉All OTC trade in CP shall be reported within 15 min of the trade to the financial market trade reporting of clearcorp dealing system.
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