Debts

Step 1: Define a debenture. A debenture is a long-term debt instrument used by companies to borrow money. It is an acknowledgment of debt. Step 2: Understand the terms of a debenture. One of the primary features of a debenture is the predetermined interest rate, also known as the coupon rate. This rate is specified in the debenture certificate and does not change throughout the life of the instrument. Step 3: Conclude the nature of the interest rate. Because the rate is specified at the time of issue and remains constant, it is a 'fixed' rate of interest.