Debentures can be generally related to the private sector companies. Such a company will take out a certain amount of money similarly to a loan procedure, and will pay to the creditor interest. This loan also works as a balloon type of repayment, which means that for the term of the loan only interest, will be paid to the creditor, and when the term is up the loan principal is being paid off in full. Types of debentures include the non-convertible debentures, the fully convertible ones, and the partly convertible debentures. The fact whether these are convertible means that the creditor might have the benefit of being a shareholder at some point in the future, as agreed in the contract.