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What is a commercial paper? - Business Studies

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What is commercial paper?

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Solution

Commercial paper is a credit instrument used by creditworthy firms to obtain short-term finance for their business. These are unsecured promissory notes, the maturity of which ranges from 90 to 364 days. They are generally issued to business firms, banks, insurance companies and pension funds, and their issue is regulated by the Reserve Bank of India.

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Meaning and Nature of Business Finance
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Chapter 8: Sources of Business Finance - Long Answers [Page 205]

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NCERT Business Studies [English] Class 11
Chapter 8 Sources of Business Finance
Long Answers | Q 6.1 | Page 205
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