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NISM Certifications · NISM-Series-VI: Depository Operations · Special Services - Debt Instruments and Government Securities

A client asks a Depository Participant whether Treasury Bills issued by the Government of India can be held in demat form. Which statement is correct about Treasury Bills in this context?

Treasury Bills are short-term government securities, with maturities of 91, 182 or 364 days, and they can be held in dematerialised form. They are issued at a discount and redeemed at par, so they pay no periodic coupon and are not long-term instruments.

  1. ATreasury Bills are short-term government securities that can be held in dematerialised formCorrect
  2. BTreasury Bills can be held only as physical certificates
  3. CTreasury Bills are long-term securities with maturity above ten years
  4. DTreasury Bills pay a fixed half-yearly coupon and cannot be held in demat

Explanation

Treasury Bills are short-term money market instruments issued by the Government of India with maturities of 91, 182 or 364 days. They can be held in demat form, usually through a Subsidiary General Ledger or a demat account. They are issued at a discount and redeemed at face value, so they carry no coupon.

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