Notice Money definition
Notice Money means borrowing or lending in unsecured funds for tenors up to and inclusive of 14 days excluding overnight borrowing or lending;
Notice Money means deals in funds for 2 – 14 days.
Notice Money means deals in funds for 2 – 14 days. • “Term Money” means deals in funds for 15 days-1 year. Participants Scheduled commercial banks (excluding RRBs), co-operative banks (other than Land Development Banks) and Primary Dealers (PDs), are permitted to participate in call/notice money market both as borrowers and lenders. Commercial Paper: • Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note. CP, as a privately placed instrument, was introduced in India in 1990 with a view to enable highly rated corporate borrowers to diversify their sources of short-term borrowings and to provide an additional instrument to investors. • Individuals, banking companies, other corporate bodies (registered or incorporated in India) and unincorporated bodies, Non-Resident Indians (NRIs) and Foreign Institutional Investors (FIIs) etc. can invest in CPs. However, investment by FIIs would be within the limits set for them by SEBI from time-to-time. Who is permitted to issue CP: Subsequently, primary dealers (PDs) and all-India financial institutions (FIs) were also permitted to issue CP to enable them to meet their short-term funding requirements. However the corporate issuing CP should meet the following conditions 1. The tangible net worth of the company, as per the latest audited balance sheet, is not less than Rs.4 crore; 2. The company has been sanctioned working capital limit by bank/s or FIs; and 3. The borrowal account of the company is classified as a Standard Asset by the financing bank/institution. 4. The minimum credit rating shall be ‘A3’ as per rating symbol and definition prescribed by SEBI. Minimum and maximum period of maturity: CP can be issued for maturities between a minimum of 7 days and a maximum of up to one year from the date of issue.