Everyone wants to augment their existing wealth and take the cash balances to the next level. In today’s era, we have got a handful of investment choices to choose from and invest accordingly. Out of the available asset classes, bonds are considered to be the secured ones. Whether you are a salaried employee or self-employed or HUF or University, bonds can be bought and held by anyone. While there are various types of bonds, this article solely focuses on perpetual bonds in India.
What is a Perpetual Bond?
Wondering what is a perpetual bond India? Commonly or popularly known as perps or consol bonds, these bonds don’t carry any maturity period. In simple words, perpetual bonds are those bonds issued by banking companies and government entities. These bonds don’t have an expiry date to redeem the principal amount. All the investors will receive interest on these bonds till the entity keeps running actively in the business world. There’s no set date for repayment of the principal money, as the bond is perpetual.
The investor will earn coupon payments eternally, provided the underlying assumption that the company continues to carry on its business ahead. Even the bond issuing company doesn’t have any debt compulsion to pay back the principal money to the lenders. Moreover, a perpetual bond doesn’t have any particular redemption date. So, the right to call or redeem the perpetual bond stays with the bond issuer only.
4 Places To Buy Perpetual Bonds in India
A perpetual bond is a financial instrument used by corporations or banks to raise capital for the long-term needs of the entity. If you are looking for a stable income regularly, this bond is an ideal fit for you financially. Now that you have clearly understood the concept of a perpetual bond, below is the list of places to buy them.
Some perpetual bonds have the call option, where the issuing authority has the right to terminate the bond anytime they want. You can buy perpetual bonds at financial institutions. Banks issue these instruments to generate funds to meet their tier -1 capital needs.
Online Bond Selling Portals:
Another place to buy perpetual bonds in India is the online bond portals. The introduction of technology in the financial space mushroomed new opportunities for bond issuing houses. Today you can buy these bonds in less than a few minutes by signing up online. All you have to do is register yourself by furnishing the necessary proofs requested by the lender and submitting them accordingly. As and when you finish the process, you are all set to buy all kinds of bonds online, and that includes perpetual bonds too. Now, what are you waiting for? Start your investment in perpetual bonds in India here.
The other platform to buy perpetual bonds in India is at the government organizations or entities. It’s called to be the best en route to raise money by the government for the public projects. Although economists and experts wouldn’t perch on the thought of extreme debt borrowing, the government could use this as an opportunity to build and uplift the economy.
Knowing that you wouldn’t get your principal back, some investors still shell out their earnings on these bonds because of the perpetual returns. However, if you are willing to put an end to the perpetuity, the exit route is to sell these instruments in the secondary market.
Know also- what are zero coupon bonds, government bonds, corporate bonds, tax free bonds, g-sec strips, how to buy beneficial early retirement pension plans online, how to invest in fixed income securities