NOIDA: The office of real estate giant Supertech Group in Noida has been sealed by the Gautam Buddh Nagar district administration on Wednesday over unpaid dues.
The action was initiated to recover the dues from the company’s Supertech Township entity, following the issuance of recovery certificates by the UP Real Estate Regulatory Authority (RERA). However, the Supertech Group has called the administration’s action “illegal” and said that the recovery has to be made from Supertech Township, not from Supertech Limited, which owns the sealed office.
The Additional District Magistrate (Finance/Revenue), Vandita Shrivastav, confirmed the development and said that the process of sealing the office had started on Tuesday afternoon under the supervision of the tehsildar, Dadri.
The Supertech Group condemned the district administration’s action, saying it has caused significant hardship to home buyers who need to visit these offices for their various needs. The company has claimed that the action is illegal, as it is currently under Corporate Insolvency Process initiated by the NCLT. As per the moratorium clause of the IBC, no dues can be coercively recovered by any authority until the resolution process is over.
The Interim Resolution Personnel (IRP) appointed by the NCLT has written to the district administration to de-seal the premises immediately and is also planning to take up the matter with the National Company Law Tribunal (NCLT) or the Supreme Court.
In August last year, the Supreme Court had ordered the demolition of the twin towers of the Supertech Group, which were built in violation of building norms.
Fashion designer Sandeep Khosla, one of the co-owners of the popular label Abu Jani and Sandeep Khosla, has recently acquired a luxury apartment located in Mumbai’s upscale Juhu area for over Rs 25.75 crore.
The apartment, which spans 4,166 sq ft, is situated in the ready-to-move Rustomjee Elements development off Juhu Versova Link Road. The project is spread over three acres and contains only 173 residences. The property transaction was finalized and registered on March 20, as per documents available on Zapkey.com. Stamp duty of over Rs 1.54 crore was levied on the property.
In recent months, the sale of luxury properties has seen a significant rise, particularly in February and March, after the announcement in the Union Budget 2023-24 to cap the deduction from capital gains on investments in residential property at Rs 10 crore from April 1.
ET reached out to Khosla’s team and Rustomjee Group, the project’s developer, but did not receive any response by the time of going to press.
Sandeep Khosla and his business partner Abu Jani are renowned figures in the Indian fashion industry, catering to a diverse clientele ranging from industrialists to leading Bollywood personalities. Their company ABSA Fashions has recently signed a long-term lease of five years to occupy 18 floors of office space in Mumbai’s western suburb of Goregaon, for which they will be paying rentals of over Rs 60 crore excluding escalation. The rentals will increase by 12% after the first 36 months, as per the agreement.
In April 2022, Reliance Brands acquired a 51% stake in their designer label, although both Jani and Khosla will continue to lead the brand’s design and creative direction.
The Hiranandani Group has announced plans to invest Rs 1,000 crore in the construction of 1 million sq ft of housing for its ongoing township project in Panvel, near Mumbai.
Founder and managing director Niranjan Hiranandani told Moneycontrol that the company plans to construct apartments in the 1, 2, and 3 BHK categories, priced between Rs 70 lakh and Rs 2 crore, on land purchased in 2008. The company aims to tap into the growing demand for luxury homes in Panvel and plans to offer an array of recreational and leisure amenities for homebuyers.
According to Hiranandani, the Panvel realty market is booming as a new economic node, thanks to the commissioning of mega infrastructure projects that have led to an increase in property prices. The region is also attracting many organized and branded developers looking to capitalize on new growth opportunities. The company’s new residential sector aligns with the market buoyancy and seeks to capture the strong demand for branded luxury homes post-Covid.
Hiranandani Fortune City, Panvel, has already delivered 2,200-plus homes across 2.5 million square feet of residential space and 2 million square feet of commercial space, housing Asia’s largest Yotta NM1 data center. The township’s holistic ecosystem and quality residences can help investors earn lucrative rental yields in the marketplace, according to Hiranandani.
Panvel’s proximity to Mumbai is attracting homebuyers, and its growing population is leading to an increase in commercial and retail spaces, social amenities, educational campuses, research and development centers, banking, financial services and insurance, IT offices, and tourist destinations. Hiranandani dubbed the Panvel-Karjat region as “Mumbai NXT” because of its renewed connectivity with Mumbai and the dual advantage of the Jawaharlal Nehru Port Trust and the Navi Mumbai international airport. The Mumbai Trans Harbour Link connecting Mumbai and Navi Mumbai, a new coastal road, metro rail, multi-modal corridor, and water transport will lead to unprecedented real estate growth, the company said.
The Hiranandani Group has also announced plans to foray into redevelopment opportunities in Mumbai city and the Mumbai Metropolitan Area (MMR). The group has developed India’s first-ever mixed-used integrated township across geographies like Powai, Thane, Panvel, and Oragadam in Chennai. The group has also strategically forayed into emerging real estate asset classes like Industrial and Logistics Parks, Data Centre that marks its pan-India presence. Currently, the group is also actively evaluating redevelopment projects in Mumbai and MMR markets, according to a company statement.
Despite a slowdown in housing registries in the city, stamp duty revenues from the district increased significantly in the 2022-23 fiscal year as the economy recovered after two years of pandemic setbacks.
Housing registers may be backed up in the city, but stamp duty earnings from the district increased significantly in the 2022–23 fiscal year as the economy recovered after two years of pandemic losses.
According to the registration and stamps department, 1.4 lakh properties, including plots, were registered in Gautam Budh Nagar during the 2022–23 fiscal year, generating Rs 3,018 crore in stamp duty and registration fees. A total of 1.2 lakh properties were registered in the previous fiscal year, generating revenue of Rs 2,377 crore.
When the pandemic struck in 2020–21, property registration revenue had fallen to Rs 1,593 crore, which was 50% below the Rs 3,148 crore anticipated target for that fiscal year. The next year, the collection somewhat increased but fell 31% short of the Rs 3,463 crore yearly target.
The state government set an ambitious goal of Rs 4,062 crore for the fiscal year 2022–2023. Revenues have fallen short by almost 25%.
Officials claim that over the past six years, the department has failed to meet its targets. For example, in 2016–17, it collected $1,761 against a target of $2,222; in 2017–18, it collected $1,685 against a target of $2,252; in 2018–19, it collected $1,879 against a target of $2,532; and in 2019–20, it collected $1,856 against a target of $2,597.
Stalled flat registrations in numerous Noida housing societies as a result of the deadlock over the repayment of legacy debts between real estate firms and the Noida Authority are one of the causes affecting revenue collection. In order for homebuyers to verify the status of the projects they have invested in, the Noida Authority recently released information about all residential properties on its website. That indicates that, since April 1 of last year, just about 3,500 registrations have been completed. Prior to that, in 2021–2022, just 2,424 residential properties were registered.
According to Abhishek Kumar, president of the Noida Extension Flat Owners Welfare Association, thousands of homebuyers are unable to obtain deeds for their flats as a result of the standoff in both Noida and Greater Noida. “We do not know the exact number of flats that have been registered this year. He urged the government to act and expedite the registration of apartments.
According to information shared by the six sub-registrar offices—three in Noida, one in Dadri, Sadar, and Jewar—the Noida 1 office registered 11,952 properties in 2022–2023 as opposed to 10,117 the year before. Noida 1 covers sectors like 1, 4, 7, 14, 14-A, 17, 20, 23, 26, 29, 32, 35, 74, and 77.
In comparison to the 10,379 properties registered in the previous year, the Noida 2 office, which covers sectors 2, 5, 8, 11, 15, 15-A, 18, 21, 24, 27, 72, 75, 78, and 135, registered 12,345 properties this year. Noida 3, registered 11,796 properties against the previous year’s 8,096, which covers sectors 3, 6, 9, 12, 16-B, 19, 22, 25, 73, 76, 136 and others.
A total of 52,060 properties were registered at the Dadri sub-registrar office, which covers Greater Noida West. Around 45,187 properties were registered at the office in the previous year.
Compared to 30,524 properties registered last year, 36,994 were registered this year by the Sadar sub-registrar’s office.
This year, only the Jewar office saw a slight decline in property registrations. In comparison to the 18,335 properties registered the year before, 16,587 properties in total were this year. The government has reportedly purchased a sizeable piece of land for the Noida International Airport, according to a representative from the Jewar sub-registrar’s office. Farmers who received compensation purchased agricultural land in nearby districts. Other landowners are in hope that their properties will eventually be acquired by the government as part of the second land acquisition phase. Because of this, fewer lease deeds are being registered in the Jewar area, he claimed.
Currently, properties in Gautam Budh Nagar are subject to a 5% stamp duty and a 1% registration fee. The registration fee is 1%, and the stamp duty is 7% for properties in the Yamuna authority’s jurisdiction.
The Kolkata Municipal Corporation buildings department has decided to take strict action against real estate promoters who have been found guilty of duping flat owners.
As per the new policy, the trade license of such promoters will be revoked. Earlier, architects or licensed building surveyors were penalized for failing to provide facilities to flat owners after the completion of a housing project or standalone apartment building.
Recently, a promoter engaged in the construction of an apartment building was booked by the building department following complaints from a section of flat owners. The promoter is being interrogated by civic officials. The KMC buildings department will check the track record of the promoter before taking a punitive step. If found guilty, the promoter’s trade license will be revoked.
The KMC buildings department has decided to keep a watch on real estate promoters accused of not keeping commitments, providing necessary amenities to flat owners, or fleeing before applying for a completion certificate from the civic body. Without a completion certificate, flat owners face difficulty applying for water supply or drainage lines.
The mayor, Firhad Hakim has asked the buildings department to take action against a section of architects or licensed building surveyors for the suffering of flat owners. The KMC buildings department officials are flooded with complaints from citizens across the city about truant promoters fleeing after the construction of an apartment building without applying for a completion certificate. Such housing projects are often found to have deviations and are branded as illegal structures.
NSE Indices, a subsidiary of the National Stock Exchange of India, has introduced the country’s first index focused on Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs). The new index aims to provide a benchmark for investors to track the performance of these emerging asset classes, which have gained significant attention in recent years.
The index will include all the REITs and InvITs listed on the National Stock Exchange, offering investors an opportunity to gauge the overall performance of these investment vehicles in India’s real estate and infrastructure sectors. As a transparent and reliable tool, the index will help promote better understanding and awareness of REITs and InvITs among market participants and investors.
By launching this first-of-its-kind index, NSE Indices aims to provide an impetus to the growth and development of the REIT and InvIT markets in India, while fostering increased participation from domestic and international investors.
An aero city will be a part of the future Noida International Airport in Greater Noida, which will increase its revenue. The aero city, comparable to the airports in Delhi and Hyderabad, will be spread across 172 acres which will include lodging, dining, shopping, and entertainment options. According to Christoph Schnellmann, chief executive officer of Noida Airport, the aero city is anticipated to be operational by the end of 2024 following the completion of the first phase.
The idea of an aero city is becoming more popular among airport developers because, unlike Delhi or Hyderabad airports where the Airport Authority of India is a minority partner, the revenue generated by it goes to the operator and is not required to be shared with the joint venture partner.
The hotels and restaurants in aero cities, which are situated outside airport premises, are separate from those existing inside. There are three primary revenue streams for a private airport developer: aeronautical, non-aeronautical, and aero-city. Aeronautical profits are generated from levies for arriving and departing passengers, as well as landing and parking charges on aircraft. The airport’s inside shops, eateries, and liquor stores provide the non-aerial revenue stream. The AAI receives a portion of both revenue streams. Yet, the airport developer is the exclusive owner of aero city’s earnings.
Worldwide, non-aeronautical revenue accounts for about 70% of airport operator revenues, but in India, this percentage is closer to 50%. Currently, Delhi is the second-largest aero city after Hyderabad, which occupies 200 acres. The GMR Group manages the Goa Airport, the Hyderabad Airport, and the Delhi Airport, and is now building an aero city in Hyderabad. The Bangalore International Airport is also creating an aero city under Fairfax’s direction.
After completing the first phase of operations, the proposed Noida airport, the second airport in the Delhi-National Capital Region, will feature one runway and one terminal and be able to accommodate about 12 million people annually. In 2019, Zurich Airport International AG won the contract for the development and management of the airport. The Swiss business is carrying out the work through its subsidiary, Yamuna International Airport (YIAPL). Eight airports in South America and the Zurich Airport are currently under its management.
The development of an airport hotel with more than 220 rooms at Noida Airport’s Aero City was announced by Roseate Hotels & Resorts last year. According to Christoph Schnellmann, the concessions for commercial buildings like restaurants, stores, and hotels will be distributed over the following nine months.
An important advancement in increasing airport revenue is the establishment of an aero city at the Noida International Airport in Jewar. It is also a great illustration of how private airport developers can generate their own independent revenue. After the Noida airport’s first phase is finished, travellers will have improved access to services, amenities, and connectivity, which will enhance their overall air travel experience.
In order to be exempt from coercive recovery actions against builders, real estate developers in Noida and Greater Noida have petitioned the district magistrate of Gautam Budh Nagar, the district of which they are a part.
The dues are payable to the Industrial Development Authorities of Noida, Greater Noida, and the Yamuna Expressway.
In a letter, the Uttar Pradesh Chapter of the National Real Estate Development Council (NAREDCO) asked Gautam Budh Nagar District Magistrate (DM) Manish Kumar Verma not to begin coercive recovery action against builders and to wait for the findings and recommendations of the Amitabh Kant Committee on stuck projects.
Builders owe an estimated Rs 40,000 crore, including premium, interest, and penal interest, for allotted plots on which real estate projects are being completed at various stages.
To find the problems being faced by stalled real estate projects and to suggest ways to revamp them, the Union Ministry of Housing and Urban Affairs has set up a 14-member committee headed by former Niti Aayog CEO Amitabh Kant. The committee has six months to submit its report from the date of its first meeting.
Additionally, the developers requested that the DM call a joint meeting of the CEOs of the Greater Noida, Noida, and Yamuna Expressway Authorities and the Chairman of the Uttar Pradesh Real Estate Authority (UPRERA) to seek a cordial solution and suggest measures to the state government that would allow developers to deliver flats and plots to customers.
Builders also asked the DM to “impress upon” the authorities to permit sub-leasing of project implementation in proportion to the land payments already made by the developers.
They said that because the allotted land is typically not free of encumbrances, developers owe overdue land dues to the Noida, Greater Noida, and Yamuna Expressway Authorities.
According to UP NAREDCO, a large number of farmers filed petitions before the Allahabad High Court, which issued stay orders as a result, and construction was halted until the matter was resolved by the Supreme Court because the Authorities failed to obtain consent from farmers at the time of land acquisition.
Homebuyers were not willing to pay for the cost with interest, and the builders’ organization stated, thus the responsibility of additional farmer compensation at the rate of 64.7 percent had been transferred to developers as a result of court orders, which also contributed to the unpaid land dues.
The letter said that because of the delay, build developers had fallen behind on their land payment obligations due to a liquidity crisis. The Authorities have stopped accepting building plans, changes, and approval for subleasing in the interim and now demand a No Dues Certificate (NDC) as a prerequisite.
Due to the liquidity crisis, project loans that were taken on have become non-performing assets, and lenders are suing developers in the National Company Law Tribunal.
According to the developers’ body, any attempt by the district administration to start forceful land dues recovery would be detrimental to the interests of homebuyers, banks, and financial institutions. It would result in never-ending legal disputes.
UP NAREDCO said, “We are confident that the Committee will take into account the real challenges and will come up with a cordial solution that protects the interests of investors, authorities, and homebuyers. Since any coercive recovery would negatively affect the interests of approximately 2.50 lakh homebuyers, we request that the Noida, Greater Noida, and Yamuna Expressway Authorities as well as UPRERA refrain from taking the coercive recovery action and delay it at least until the resolution based on the findings and recommendations of the Amitabh Kant Committee”.
Debt-based mutual funds are money market funds (MMF). They are designed with the intention of giving reasonable and consistent returns while maintaining the investment’s liquidity. It’s crucial to keep in mind that MMF has relatively short durations, with an ideal maturity period of 12 months on average. These are just a few of the explanations for why MMF are thought to be relatively low-risk.
How Do They Function?
As implied by their name, money market funds in India invest in the following short-term money market instruments:-
Treasury Bills
The Government of India issues Treasury Bills, also referred to as T-Bills. With a typical time frame of one year, the goal is to raise capital. These are among the safest investment options because they are backed by the government. However, as one would anticipate, because there is virtually no risk involved, the returns are also somewhat on the lower side.
Certificate of Deposit
Commercial banks with the necessary permission and authority issue certificates of deposit, also known as CDs. These have a fixed term and, unlike a typical Fixed Deposit (FD), do not permit early redemption. The rest of the fundamental ideas are essentially unchanged.
Commercial Paper
Financial institutions with typically high credit ratings issue Commercial Papers, also called CP or Promissory Notes. These are unsecured, short-term loans. They are provided at a reduced price, but they must be redeemed for the full amount of the original note. The benefits of short-term borrowing from various sources for investments and operating costs go to the companies, while the investor receives returns in the form of the delta price between purchase and redemption.
Repurchase Agreements
A Repurchase Agreement, also known as a Repo, is a contract between two banks. The Reserve Bank of India (RBI) is typically one of the two banks. In essence, it suggests that the two banks involved have a loan agreement.
As you have probably noticed, the commonality among all of the aforementioned money market instruments is low-risk, predictable, and steady (albeit lower) returns.
Benefits and Considerations for Investing
The features and operations of money market funds must now be understood by the reader, and they must also be aware of the things to think about before investing in them.
Lower Expense Ratio
The associated costs of fund management are very low because the primary goals of these debt funds are to safeguard the principal and invest in short-term gains. This is a crucial factor because the returns are lower in any case. The fund manager, market research analysts, etc. do not further dilute the gains; rather, they are returned to the investor as part of the returns.
Returns and Risks
Money Market Funds in India primarily serve the purposes of offering stable returns, safeguarding your principal investment, and reducing risk exposure, as was stated throughout the article. Although these funds tend to offer higher rates than savings accounts while maintaining the same benefit of keeping the investment largely liquid, they do carry some of the risks associated with debt funds to some extent.
Tax
Money Market Funds are a subset of Debt Funds as a whole. As a result, they are taxable in accordance with local law and are subject to indexation benefits as well as STCG (Short Term Capital Gain) and LTCG (Long Term Capital Gain). The STCG applies if the funds are retained for up to three years. LTCG is applied to periods longer than three years.
Investment horizon
These funds are appropriate for three to one year long short-term investment goals. Choose dynamic bond funds if your investment horizon is moderate.
Financial goals
Money market mutual funds are a good option if you’re looking for a short-term place to park extra investable funds that would yield better returns than standard savings accounts.
Money market mutual funds are in competition with other debt-related investments as well as conventional investments. Although they aim for higher returns, these funds invest in a wider variety of assets.
These funds’ main goal is to provide secure avenues for investing small amounts of money in debt-based assets and secure, highly liquid cash equivalents. These programs are low-risk, low-return investments in the mutual fund investment format.
So these funds have the advantage of being very liquid, inexpensive, and intended to provide higher returns than a bank’s savings account.
On the other hand, because they are unsecured investments, their value is susceptible to shifts in the interest rate environment. Second, capital gains are considerably less.
Who should invest in money market mutual funds?
Mutual funds that invest in money markets aid in portfolio diversification. The main goal is to produce low-risk short-term returns through investments in reputable money market instruments. To achieve the highest short-term gain, the corpus is invested in a well-diversified portfolio. These funds are open to investors with high liquidity and a one-year time horizon for investments.
Additionally, money market fund schemes that produce predictable returns in the short term are a good option for low-risk investors seeking higher returns than those offered by conventional investment options like fixed deposits.
Money market mutual funds might not be the best choice for you, though, if you have a long time horizon for your investments. Instead, you should put money into balanced or dynamic bond funds, which are still low-risk options that can produce higher returns than money market mutual funds.
Summary
Money market funds are debt-based mutual funds that invest in short-term, low-risk money market instruments. They are designed to provide reasonable and consistent returns while maintaining liquidity, with an average maturity period of 12 months. Money market funds offer lower expense ratios compared to other funds, which means lower costs for investors. These funds are suitable for short-term investment goals and offer higher returns than savings accounts while maintaining liquidity. However, investors should consider the associated risks and tax implications before investing in these funds. Money market funds are an excellent option for low-risk investors seeking higher returns than those offered by traditional investment options like fixed deposits. Overall, money market funds provide a secure and liquid avenue for investing small amounts of money in debt-based assets, making them a valuable addition to any investor’s portfolio.
Debt instruments are financial tools that individuals and corporations can use to raise capital. This article will cover the definition, types, and examples of debt instruments.
What Is a Debt Instrument?
A debt instrument is a fixed-income asset that is used to raise capital. A debtor provides interest and principal payments to a lender. The debt instrument is a documented and binding obligation that gives funds to an entity, which will pay back the funds based on the terms of a contract.
Types and Examples of Debt Instruments
There are various types of debt instruments, including:
Bonds
Governments and businesses issue bonds. An investor pays the issuer the market value and, in return, receives guaranteed loan repayment and scheduled coupon payments. Coupon payments are expressed as a percentage of the face value of the bond and represent the annual rate of interest the bond would pay.
Debentures
Debentures are often used to fund projects by raising short-term capital. They are backed by the issuer’s trustworthiness and credit. Like bonds, debentures are popular with investors since they have guaranteed fixed rates of income.
Fixed-Income Assets
Corporations and government entities offer fixed-income assets to investors as investment securities. An investor purchases the security for the full amount of the asset and receives either interest or dividend payments in return until the debt instrument reaches maturity. Once this happens, the issuer of the debt pays the investor the full principal amount.
Mortgages
Mortgages are used to finance real estate purchases, such as commercial property, a home, or land. The mortgage is amortized over time, allowing the borrower to make payments until it is paid off in full. The lender of the mortgage also receives interest in return, and the risk of default is minimized since the real estate purchase itself is used as collateral.
Loans
Loans can be used for a variety of reasons and can be obtained from a financial institution. When an individual takes out a loan, they receive a sum of money from the lender with the agreement to repay the amount over a period of time. There will also be a predetermined amount of interest that will get added to each payment.
Credit Cards
When an individual applies for a credit card, they receive a credit limit that they have access to over time. They can continue to use a credit card as long as they make any required monthly payments. There are two payment options: paying in full each month as a lump sum payment to avoid any interest charges or making the minimum monthly payment. If the minimum monthly payment is made, the remaining balance will get carried into the next month with interest added.
Lines of Credit (LOC)
Lines of credit give individuals access to a credit limit that’s based on their credit score and the relationship they have with the bank. The limit is revolving, meaning that they can draw on it as long as they make the payments. There is a principal amount and interest with lines of credit. They can be secured or unsecured, but this is based on the specific requirements of the borrower and the financial institution. There will also be a payment schedule to repay the remaining loan amount.
Advantages of Debt Instruments
Debt instruments can be a beneficial choice to help raise capital since they come with a defined schedule for repayment. With this also comes lower risk and ultimately lower interest payments. There are several advantages of debt instruments, including:
Interest Rates – Debt instruments often come with lower interest rates compared to other forms of credit such as credit cards. The interest rate is usually fixed for the term of the debt instrument, which makes it easier to budget and plan for the repayment of the debt.
Flexibility – Debt instruments are often flexible in terms of repayment options. Most lenders will work with the borrower to find a repayment plan that suits their needs and financial situation. This can include longer or shorter repayment terms, balloon payments, or even interest-only payments.
Lower Risk – Debt instruments are often considered to be less risky than other forms of credit such as credit cards or lines of credit. This is because they are secured by an asset, such as a home or a car, which can be seized if the borrower defaults on the loan.
Improve Credit Score – Making timely payments on a debt instrument can help improve a borrower’s credit score. This is because a history of on-time payments shows that the borrower is responsible with credit and can be trusted to make payments on time.
Disadvantages of Debt Instruments
While debt instruments can be a useful tool for raising capital, they also come with some disadvantages that borrowers should be aware of. These include:
Repayment Obligations – When a borrower takes out a debt instrument, they are committing to making regular payments for the term of the loan. This can be a burden on the borrower’s finances, especially if they experience a change in their financial situation, such as a job loss or illness.
Collateral – Debt instruments are often secured by an asset, such as a home or a car. If the borrower defaults on the loan, the lender has the right to seize the collateral to recover their losses. This can be a significant risk for borrowers who may lose their home or car if they cannot make their loan payments.
Interest Payments – Debt instruments come with interest payments that add to the overall cost of borrowing. While the interest rate is usually fixed for the term of the loan, it can still be a significant expense for borrowers, especially if they have a large amount of debt.
Conclusion
Debt instruments are a useful tool for raising capital, whether for personal or business purposes. They come in a variety of forms, including bonds, debentures, mortgages, loans, and lines of credit. While they offer several advantages, including lower interest rates, flexibility, and lower risk, they also come with some disadvantages, such as repayment obligations, collateral requirements, and interest payments. Borrowers should carefully consider their financial situation and the terms of the loan before taking on any debt instrument.
