What is repayment indexation?

This is a method whereby the redemption of, for example, bonds is adjusted to inflation. This means that the redemption rate is increased in line with inflation, causing the redemption to ultimately take place above par (more than 100%). In practical terms, this means that the investor, in monetary terms, receives a higher amount back than the amount originally loaned. This mechanism protects the investor against the depreciation of money due to inflation.