What is the minimum holding period for availing NCD interest

To receive yearly Interest from NCDs of Corporate Companies, is there any minimum period of holding the NCDs (Apart from complying the Record Date)?

Aug 4, 2019 by Sudhakar C, Hyderabad  |   Financial Advisory

The minimum period of holding vary from one issue to the other in case of NCDs. Please note that when you subscribe to a NCD you know the date on which the NCD will mature. If you are holding the NCD till maturity you will get the interest payable on it till the maturity date. In other words, on the record date of interest payment, the company checks the name of each NCD holder and pays the interests accordingly.

You may be aware that you can hold the NCDs electronically in your demat account. That means, you can buy and sell NCDs through your broker provided there is liquidity. The point to be noted here is that, you will ceased to get any interest if you sell your NCDs before the maturity date.

Therefore, there is no minimum or maximum period of holding required for getting interest on NCDs. The NCD holder's names appearing in the books on the record date will be eligible to get interest as per the frequency mentioned in the offer document.

Hope this is clear to you. Thanks.

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