Payment in kind

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In finance, when a bond pays in kind, it means that the amount of principal owed to the bondholder is increased in lieu of paying current interest. Often it is referred to by the acronym PIK.

PIK can be used as a verb (e.g. the bond "PIKed") or an adjective (e.g. that bond is "PIKable").

Most bonds are not PIKable. A bond that does not pay current interest and is not PIKable is said to be in default.

"Payment in kine" is a colloquialism referring to payment for goods or services with a medium other than money, the term originating from when people were paid in cattle (kine is an archaic noun meaning cow, from Middle English "kyn").

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