# D

Debit Card: A plastic card issued by banks to customers to withdraw money electronically from their accounts. When you purchase things on the basis of Debit Card the amount due is debited immediately to the account. Many banks issue Debit-Cum-ATM Cards.

Debtor: A person who takes some money on loan from another person.

DEBT RECOVERY TRIBUNALS (DRT): These tribunals are established under the Recovery of Debt due to Banks and Financial Institutions Act 1993 for expeditious adjudication and recovery of debts due to Banks and financial institutions and for connected matters or incidental there to. Cases of recovery can be filed by Banks and financial institutions with the DRT where the amount of debt is not less than Rs 10 lakh.

DEBT SERVICE RATIO: The proportion of annual export revenue (from goods and invisibles) of a country, which constitutes its repayment obligations of the principal and interest on external debt for the year.

DEBENTURE - A debenture is basically an unsecured loan to a corporation. A type of debt instrument that is not secured by physical asset. Debentures are backed only by the general creditworthiness and reputation of the issuer.
1. Convertible Debentures: Any type of debenture that can be converted into some other security or it can be converted into stock..
2. Non-Convertibility Debentures(NCB): Non Convertible Debentures are those that cannot be converted into equity shares of the issuing company, as opposed to Convertible debentures. Non-convertible debentures normally earn a higher interest rate than convertible debentures do.
DEFICIT FINANCING: It is a planned excess of expenditure over income. Most governments now often spend more than they raise in taxation, the difference being financed by borrowing. The term is normally used in economics to refer to a planned budget deficit incurred in the interests of expanding aggregate demand by relaxing fiscal policy and thus injecting purchasing power into the economy.

DEFLATION: Denotes persistent fall in general price levels of goods and services. It should not be confused with decline in prices in one economic sector or fall in inflation rate (known as disinflation). While productivity driven deflation in which costs and prices are pushed lower by technological advances is beneficial to the economy that reflecting sharp slump in demand, excess capacity and shrinking money supply is harmful to the economy.

DELIVERY VERSUS PAYMENT: Execution of trade and trade settlements are the two stages involved in securities and funds transactions. There are two types of settlement systems. (i) Differed Net Settlements (DNS) and (ii) Real Time Gross Settlements (RTGS) In DNS all claims and counter claims of participants are accumulated over a period of time and netted out to arrive a multilateral net payment position. The RTGS on the other hand represents settlement of any transaction involving claims and counter claims instantly on gross basis, thereby obviating the need for clearing arrangement. While netting out under DNS reduces the liquidity requirement for the system, RTGS mechanism eliminates default risks. The application of principles of RTGS in the context of securities settlement is called Delivery Vs Payment System. In the case of Government securities transactions the selling banker signs a form for transfer of securities and the buying bank authorises transfer of funds from its account with the RBI.

DEMAND FOR MONEY: A term often used in the context of the study of inter- relationship between money, output and prices, to explain why individuals and business hold money balances. The important motivations for holding money balances are (i) transaction demand signifying that people demand money to purchase goods and services (ii) asset demand relating to the desire to hold a very liquid risk free asset. In other approaches money holding is said to be resting on the basic variables of income and rate of return.

DEMONETISATION: Refers to the policy of removal of certain currency from circulation or the discontinuance of the monetary unit of a nation the value of which was previously defined in terms of precious metal. The standard money made of that metal is then said to be demonetised but it may continue to circulate as Fiduciary Money. This measure is resorted to check black market operation and tax evasion.

Demand Deposits: Deposits which are withdrawn on demand by customers. E.g. savings bank and current account deposits.

Demat Account: Demat Account concept has revolutionized the capital market of India. When a depository company takes paper shares from an investor and converts them in electronic form through the concerned company, it is called Dematerialization of Shares. These converted Share Certificates in Electronic form are kept in a Demat Account by the Depository Company, like a bank keeps money in a deposit account. Investor can withdraw the shares or purchase more shares through this demat Account.

DEPOSIT INSURANCE AND CREDIT GUARANTEE CORPORATION (DICGC): This Corporation was established in January 1962, under the Deposit Insurance Corporation Act, 1961 for the purpose of providing insurance cover to the bank depositors, particularly small depositors against the risk of loss arising out of bank failures. All commercial banks including Local Area banks Regional Rural banks are to be registered under the Scheme. All specified cooperative banks like State cooperative banks and Central cooperative banks come under its ambit. As for the Credit Guarantee Scheme it is optional for the credit institutions. The Credit Guarantee Scheme is intended to provide necessary incentive to banks and financial institutions for giving credit to small borrowers, (including small farmers) to priority sector, to small-scale industries, etc; there is legislative proposal to do away with credit guarantee function of the corporation and to introduce an alternative scheme.

DEPRECIATION: In accounting, this term means calculation, by any one of the standardised methods of the decline in the value of an asset.

DEPRESSION: Denotes an economic condition characterised by lengthy period of low business activity when prices remain low, gross domestic product falls, purchasing power is sharply reduced and unemployment is high.

DERIVATIVES: Financial derivatives are basically contingent contracts whose values are derived from some underlying financial instruments like currency, bonds, stock indices, and commodities etc, whose future price movements are uncertain. Derivatives shift the risk from the buyer of the derivative product to the seller and hence are effective risk management tools. Derivatives are used to protect assets from erosion in value due to market volatility enhancing income by making a two-way price movement or making quick money by taking advantage of the volatile price movement. The popular derivative products are forward rate agreement, interest rate futures, interest rate swaps, option contracts etc.

Derivative Call (Put) Warrants: Warrants issued by a third party which grant the holder the right to buy (sell) the shares of a listed company at a specified price.

Derivative Instrument: Financial instrument whose value depends on the value of another asset.

DEVALUATION: With reference to a monetary unit, it implies a reduction in its metallic content as prescribed by law or the lowering of the exchange rate of one nation's currency in terms of the currencies of other nations. Devaluation is introduced for improving relative competitiveness in the international trade. It is resorted to as a corrective action towards solving balance of payment difficulties.

DEVELOPED COUNTRIES: Developed countries are those who have achieved (currently or historically) a high degree of industrialisation, and which enjoy the higher standards of living. The level of income in these countries are sufficient to generate the required saving for future investments. As per the World Bank's classification these are the countries (high-income) with per capita Gross National Income $3466 and more in 2005. DEVELOPING COUNTRIES: It is a group of countries that have not yet reached the stage of economic development characterised by the growth of industrialization, nor a level of a national income sufficient to yield the domestic savings required to finance the investment necessary for further growth. There are currently about 125 developing countries with populations over 1 million. As per the World Bank's classification these are the countries (middle-income) with per capita Gross National Income between$876 and \$3465 in 2005.

Discount Bond: A bond selling below par, as interest in-lieu to the bondholders.

Dishonour of Cheque: Non-payment of a cheque by the paying banker with a return memo giving reasons for the non-payment. Default Risk: The possibility that a bond issuer will default ie, fail to repay principal and interest in a timely manner.

Diversification: The inclusion of a number of different investment vehicles in a portfolio in order to increase returns or be exposed to less risk.

Duration: A measure of bond price volatility, it captures both price and reinvestment risks to indicate how a bond will react to different interest rate environments.