Why Startups Prefer NCDs over Debt or Equity?

NCDs stand for Non-Convertible Debentures and debentures are basically like bonds, which companies issue to raise money.

And NCDs are of two types.

First is convertible debentures, which allow you to convert your debentures into company shares after a certain period of time.

And Non-Convertible Debentures, as the name suggests, don’t allow you to convert them into shares.

And it’s beneficial to the company as it allows them to diversify their borrowing profile, and instill trust in the public as NCDs are nothing but public debt.

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