12.3 OTHER SOURCES OF SHORT-TERM FUNDS
Besides bank finances, there are also other sources of short-term funds, such as, issue of commercial paper, factoring, forfaiting, inter-corporate deposits, etc. Factoring and forfaiting have been discussed in Chapter 10. The present chapter discusses commercial paper.
12.3.1 Commercial Papers
Commercial paper (CP) originated in the USA on the pattern of short-term notes which meant that a company in need of short-term funds could issue CP. It is now common in developed and developing countries. There are of course differences in the procedure of issue in different countries.
In India, the issue of CP came into being after the Vaghul Committee recommendations of 1987. Here a banking company cannot issue ...
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