Bond vs debenture: what is the difference, and what is an NCD?

Platforms, brokers and exchanges use bond and NCD for the same instruments. SEBI's rules for listing them, and for the platforms that sell them, are in its master circular on non-convertible securities (SEBI NCS Master Circular).

What do the common labels mean?

Label	What it is	Tax note
NCD, non-convertible debenture	Company debt that stays debt; secured or unsecured	Interest at slab, 10% TDS if listed
Convertible debenture (fully or optionally)	Company debt that converts to shares on stated terms	Depends on the terms
Market-linked debenture (MLD)	Returns tied to a market index or other reference	Gains taxed as short-term at slab
Subordinated, perpetual or AT1 bond	Ranks below other debt; perpetuals have no fixed maturity	Interest at slab
G-sec, SDL or T-bill	Central or state government debt	G-sec and SDL interest at slab
Tax-free bond	Public sector bond with interest exempt from tax	Interest exempt
54EC bond	Bond that saves capital gains tax on a property sale	Interest at slab, no TDS

Sources: EY, Outlook Money, ICICI Direct, TradingQnA.

Is an NCD riskier than a bond?

Not because of the name. A secured NCD from a strong issuer and an unsecured, subordinated bond from a weak one are both company debt with very different risk. Read the offer document for security and ranking, and every rating, not just the best. From about 21st Nov 2026 bond platforms must show a Credit Risk-o-Meter based on the lowest rating and print unsecured in bold red (SEBI circular). See secured vs unsecured vs subordinated.

Does listed or unlisted matter?

Yes, for tax and for where you can buy. Interest on listed debentures has carried 10% TDS since 1st Apr 2023 (EY). A listed bond held over 12 months pays 12.5% on its gain; an unlisted bond or debenture is taxed at slab whatever the holding period (Business Standard, TaxTMI). Online bond platforms may sell only listed bonds, or bonds in a public issue that will be listed. Stamp duty on a transfer of corporate bonds or debentures is 0.0001% (Vinod Kothari).

Where are NCDs sold?

New NCDs come through public issues, which Groww has offered in its app since Jul 2025 and GoldenPi through UPI (Groww, GoldenPi); IndiaBonds lists them too. Zerodha does not take NCD IPO applications (TradingQnA). Listed NCDs trade on the exchange order book and on bond platforms. MLDs are offered by Digifinn and by InCred Money, which sells InCred group MLDs (Digifinn).