A debenture is a marketable security (a type of investment) issued by a business or other organization to raise money for long-term activities and growth. It is a form of debt capital so it is accounted for as debt on the balance sheet of the issuing company.
Bonds are similar, but unlike bonds, debentures are unsecured—i.e., investors have no claim to the assets of the company if default occurs. Because repayment is based solely on the creditworthiness of the issuing organization, debentures are typically issued by large corporations with triple A credit ratings. They are an effective way for corporations to use their privileged status to their advantage, borrowing money without security and few strings attached.
A debenture is a legal certificate that says how much money the investor gave (principal), the interest rate to be paid and the schedule of payments. Investors usually receive their principal back when the debenture matures (i.e., at the end of its term).
More about debentures
Some debentures issued by large corporations can be converted into ownership shares in the company that issued them (i.e. convertible debt).