Meaning:
Treasury bill are the instruments of short-term borrowing by the central government or by a state government. They are promissory notes issued at a discount for a fixed period.
Objectives of Issuing Treasury Bills:
- To raise funds for the government for meeting its expenditure thermals
- To provide outlet for investment of temporary surplus funds by investors.
Other Features of Treasury Bill:
- They are highly liquid
- They are safe investments
- They give attractive yield
- They are approved assets for SLR purposes in the case of bank.
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