O'Reilly logo

The Finance Book by Si Hussain, Stuart Warner

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

30 Debt finance

‘A small debt produces a debtor; a large one, an enemy.’

Publilius Syrus, former slave, writer

In a nutshell

Companies raise finance in one of two ways: debt or equity. Debt finance involves borrowing money that has to be repaid, plus interest.

Debt finance is money raised from debtholders (banks, finance houses, individuals, etc.). Debtholders lend money in return for repayment of the original amount borrowed (the principal) plus interest at an agreed rate and time in the future.

Debt finance is typically a cheaper form of finance for a company than equity. This is because:

Debt provides a contractual and certain return for debt holders, unlike equity which has no guarantee of return.

  • Debt can be secured against assets of ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required