Question

Give two merits of Inter Corporate Deposits.

Answer 1

1. No Procedural Delays: Inter-Corporate Deposits (ICDs) involve minimal legal formalities. There is no lengthy paperwork or regulatory approval required. Funds can be arranged quickly and easily between two companies.
2. Easy availability of finance: Companies with surplus funds often provide ICDs to other companies that need short-term finance. Since it is a mutual agreement, finance is readily available without going through banks or financial institutions.