Almost every dispute about a coupon structure dissolves the moment somebody writes out the cash-flow table. There are six structures worth knowing cold, and the useful way to hold them is by where each one puts the issuer's cash strain.
A fixed-rate bond pays the same amount every period. All the risk of a rate move sits with the price, not the cash flow, which is why it is the reference case for everything else.
What other coupon structures are there?
A step-up raises the coupon on stated dates. The schedule is fixed at issue, so nothing is contingent, but the effect is to defer cash cost into the later years of the life. Step-ups appear when an issuer expects its credit to improve, when a regulator requires a rising rate to discourage a perpetual instrument from being left outstanding, and in structures where the step is triggered by a rating downgrade rather than by a date. A rating-triggered step-up is a different animal, because it is contingent, and it usually makes credit deterioration more expensive at exactly the moment the issuer can least afford it.
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A deferred-coupon bond pays nothing for an initial period and then pays cash. A project financing whose asset is under construction is the classic case: there is no revenue in years one and two, so there is no interest either.
A payment-in-kind coupon does not defer the cost, it capitalises it. The interest is added to principal and compounds, so the issuer's cash saving in the early years is bought with a larger claim at maturity. Worked Example 4 tabulates a ₹100 crore payment-in-kind structure alongside a step-up on the same principal and the same five years, and the difference at maturity is ₹36.7631 crore of extra principal to refinance.
A floating-rate note resets its coupon periodically against a published reference rate plus a fixed spread. The pages on floating rate notes and discount margin take it apart properly, because the mechanics are simple and the pricing conventions around it are the single most misunderstood corner of instrument analysis.
An index-linked bond ties principal, and therefore coupon, to a published price index. The index linked bonds page does the arithmetic.
What about zero-coupon bonds and perpetuals?
Two structures do not fit the pattern and are worth naming so you recognise them. A zero-coupon bond pays no periodic interest at all and is issued at a discount, which is the form most of the money-market instruments take. And a perpetual has no maturity date, so the principal cash flow never arrives, which makes it an equity-like claim wearing a debt document. Indian additional tier 1 bank capital is the local example most likely to appear in front of you. Its coupon is discretionary as well as its maturity absent, and that combination has repriced violently more than once.
Write the table out. Most arguments about which structure is dearer end there.