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Commercial paper was introduced by RBI in 1991. It is a short-term money market instrument in the form of a promissory note. Corporate; primary dealers and all India financial institution are eligible to issue CP. The maturity period of each commercial paper is 7days to 1year from the date of issue.CP can be issued denominations of Rs. 5lakh or multiples thereof. Only a schedule bank can act as an issuing and paying an agent (IPA) for the issuance of CP.

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