Q.Explain, in brief, any four sources of borrowed capital available to a company other than debentures and public deposits.

Beyond debentures and public deposits, a company has several further avenues for borrowed capital, each suited to a different need and a different investor.

Beyond debentures and public deposits, a company has several further sources of borrowed capital, each better suited to a particular financing need.

First, bonds are formal debt securities under which the company promises to repay borrowed money, with interest, by a stated maturity date; bondholders are creditors, carrying no voting rights, and bonds can be issued for very long terms — five, ten, even fifty years — making them a genuinely long-term source. Second, American Depository Receipts (ADR) and Global Depository Receipts (GDR) let an Indian company raise capital from investors abroad without listing its shares directly on a foreign exchange: the company issues shares to a foreign depository bank, which in turn issues dollar- or euro-denominated depository receipts to foreign investors and Non-Resident Indians, traded like ordinary securities on a foreign exchange — American exchanges for an ADR, any other foreign exchange (London, Singapore, Hong Kong, and others) for a GDR. Third, commercial bank credit meets a company's short- and medium-term needs through several distinct facilities: an overdraft, letting the company withdraw more than its current-account balance up to a sanctioned limit; cash credit, granted against the pledge or hypothecation of goods, with interest charged only on the amount actually drawn; cash loans, crediting the entire sanctioned sum at once; and discounting of bills of exchange, letting the company receive cash immediately for a bill by selling it to the bank before the bill's own due date. Fourth, trade credit is the deferred-payment credit a supplier of goods extends to a business buyer, commonly for thirty days or more, often with a discount for early payment — requiring no formal loan document or security at all, and remaining one of the cheapest and most easily available sources of short-term finance any business uses. …

Students sometimes describe ADR/GDR as a form of 'owned' capital because the underlying instrument is a share; from the Indian company's own financing perspective the shares are already issued, and the depository-receipt mechanism is simply a route for foreign investors to hold an interest in those already-issued shares, so it is best treated, for exam purposes, as a source of raising capital from foreign markets rather than confused with the equity/preference classification …