It is simply the money that the mutual fund has lent to a borrower. To understand if the mutual fund has done a good job, ti is important to know the profile(s) of the borrower(s). Each borrower has a credit rating.
Some mutual funds may go aggressive and lend to a risky borrower to get a higher interest income. It is better to choose a mutual fund that prefers high quality borrowers. Incidentally the Government of India (not exactly a corporate) is also a borrower as it issues bonds which are bought by the mutual funds.Upvote8
