Commercial papers are usually known as promissory notes which are unsecured and are generally issued by companies and financial institutions, at a discounted rate from their Face Value. The fixed maturity for commercial papers is 1 to 270 days. The purposes for which they are issued are - for inventory financing, accounts receivables, and settling short-term liabilities or loans. Commercial paper was first issued in the year 1990 in India as a short-term instrument.
Commercial paper can be issued into the market by the following members:
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