With reference to zero coupon zero principal instruments consider the following statements 1 These a...........

Indian Economy (CDS) Money and banking

With reference to zero coupon zero principal instruments, consider the following statements:

1. These are issued by a not-for-profit organization that is registered with the social stock exchange.

2. An entity issuing these securities does not have to repay interest and the principal.

Which of the statements given above is/are correct?

1 only

2 only

Both 1 and 2

Neither 1 nor 2

Both 1 and 2

These are financial instruments using which any non-profit organisation (NPOs) can raise funds which are listed on the social stock exchange. Usually, NPOs raise money through donations or CSR initiatives of individuals and corporates
Central Government (Ministry of Finance) has declared Zero Coupon Zero Principal instruments as securities under the Securities Contracts (Regulation) Act, 1956 in 2022.
Zero Coupon Zero Principal Instruments shall be issued without any coupon and no principal amount shall be payable on its maturity.