What is the Difference between Bonds and Debentures

Private corporations, government agencies, and other financial institutions often issue bonds to arrange finance. Bonds are a kind of loan that is secured by their physical assets. Bond investors are like lenders who get the promise of the invested amount and, in most cases, a periodic interest throughout the bond’s life. 
Debentures are financing instruments raised by corporations to arrange finance to meet planned expenses like expansion or an upcoming project. Debentures have a fixed repayable date and pay a fixed or floating interest rate to the debenture holders. Debentures are not backed by a physical asset.

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