DEFINITION of 'Certificate Of Indebtedness'
A short-term fixed income security once issued by the United States Treasury that had a coupon. A certificate of indebtedness was something of an "IOU" from the U.S. government, giving certificate holders the promise of a return of their funds with a fixed coupon, much like any other type of U.S. treasury. In 1981, the U.S. government stopped issuing such certificates and replaced them with short-term t-bills.
BREAKING DOWN 'Certificate Of Indebtedness'
Unlike treasury bills - which are sold at a discount and mature at par value without a coupon payment - certificates of indebtedness offered fixed coupon payments. Certificates of indebtedness typically matured in one year or less, much like the treasury bills and notes that succeeded the now-defunct certificates.