Debt Financing
When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise to repay principal and interest on the debt.
Investopedia Commentary
The other way of raising capital is to issue shares of stock in a public offering, called equity financing.
Related Links
Bond Basics Tutorial
Debt Reckoning
See also: Bond, Creditor, Debt, Equity Financing, Financing
debt financing