What is Debt Financing?

A definition of Debt Financing

“Debt financing is when a company raises money by borrowing, typically through loans or by issuing bonds, which must be repaid with interest over time.”

Debt Financing in Business Glossary - What is Debt Financing?

Business Glossary > What is Debt Financing?


Examples of Debt Financing in a Sentence:

Debt financing allows companies to raise funds quickly.

Many startups rely on debt financing to launch their operations.

The firm used debt financing to expand its manufacturing capabilities.

Why is Debt Financing Important in Business?

Debt financing is crucial because it enables companies to access large sums of capital without diluting ownership. This approach aids businesses in managing cash flow and funding significant projects while retaining full control and ownership.

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Associated Terms

Here are some associated business terms and synonyms for “Debt Financing”:

  • Debt Funding
  • Borrowed Capital
  • Leverage Financing

Apple’s Debt Financing

Apple utilized debt financing to raise billions in bonds to fund its stock buyback program, while interest rates were historically low, highlighting strategic financial management without tapping into its cash reserves.

Final Notes on Debt Financing

When considering debt financing, businesses should evaluate interest rates, repayment terms, and the impact on cash flow to ensure sustainable growth.


This has been a definition of Debt Financing meaning.

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