Coupon Payment1 min read

A coupon is an annual payment of interest rate, expressed as a percentage of face value and paid from the issuing date till the bond matures or is called back.

Coupons are normally referred to as coupon rate, coupon percent rate or nominal yield

For example: If a bond with a face value of Rs 10,00,000 /- has a coupon rate of 7% annually, then the bond will pay Rs 70,000/- annually till the bond matures.

Coupon rate or nominal yield = annual payments ÷ face value of the bond