| Basis | Shares | Debentures |
| (1) Meaning | A share is a smallest unit in the total share capital of the company | Debenture is a document given by a company as evidence of debt to its holders, usually arising out of loan and mostly secured by charge on assets. |
| (2) Nature of Capital | It is a permanent capital of the company. It is not repaid during the company's life time. | It is temporary capital of the company. It is repaid at a specific period. |
| (3) Status | It represents owned capital and the shareholders' are owners of the company. | It represents borrowed capital and the debentureholders' are the creditors of the company. |
| (4) Return on Investment | Shareholders receive return in the form of dividend. Equity shareholders are paid dividend at a fluctuating rate. | They receive consideration in the form of interest which is pre-determined. The company is liable to pay interest even if it has no profits |
| (5) Voting Rights | Shareholders' enjoy normal voting rights. They can participate in management of the company. | Debentureholders' do not have normal voting rights. They do not participate in the management of the company. |
