1. Debenture holder has priority over ordinary shareholder.

2. Payment of interest is made to the debenture holder at a specified rate and at clearly defined intervals.

3. In that case a debenture holder had appointed a receiver, and the directors were allowed to bring a case against him.

4. The interest paid to debenture holders is deductible when calculating taxable profits, unlike dividend payments.

5. In the event of default or bankruptcy, debenture holders become general creditors of the issuer.