treasury bill
Treasury bills are one of three main securities issued by the U.S. federal government. A person can buy a treasury bill for a couple months to as little as four weeks. Treasury bills, along with other treasury securities, are regarded as one of the safest investments in the world because the full faith and credit of the U.S. government , which guarantees that interest and principal payments will be paid on time. Given their high demand, safety, and short lending period, treasury bills produce low interest rates. The owner receives the interest payments and the face value upon maturity. A person can buy bills by bidding at a government auction, using a third-party like a bank, or buying already issued bills at a resale market.
Treasury bills are to be contrasted with treasury notes and treasury bonds which have different maturity lengths and interest rates.
[Last reviewed in January of 2025 by the Wex Definitions Team ]
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