Pure Discount is the loan type that requires the borrower to repay a single lump sum payment at some time in the future with interest.
What is pure discount loan?
The simplest type of loan is a pure discount loan. The borrower receives funds now and makes a single, lump-sum repayment of the loan's principal and interest in the future. With interest-only loans, the full amount is repaid when the loan matures, along with a periodic interest payment.
What is pure discount bonds?
Bonds that trade at a discount to their face value and don't pay any interest are known as zero-coupon bonds. Another name for it is a deep discount bond or a pure discount bond.
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