Gujarat BoardEnglish MediumSTD 12 CommerceOCMFINANCIAL MARKET3 Marks
Question
Write a short note a commercial paper.
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Answer
Commercial paper :
Commercial paper have become much popular at world level after $1980.$
It is an instrument to procure short term fund.
Commercial paper is an unsecured short term promissory note like a document.
It is issued by corporate institutions having high creditability and sound financial positions.
In $1990$ the Reserve Bank of India, issued first commercial papers in India.
Commercial paper are transferrable $($negotiable$)$ instruments, regulated by Reserve Bank of India.
Companies and financial institutions can issue for minimum $7$ days and maximum period of $1$ year.
Commercial paper are issued at $Rs. 5$ lacs or in it’s multiplies at discount and they are known as finance paper, industrial paper and corporate paper.
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