Legal Definitions - debt capital

Debt capital refers to funds that a company raises by issuing bonds. Bonds are like loans that investors give to the company, and the company promises to pay back the money with interest over time. This is different from equity capital, which is money provided by a company's owners in exchange for evidence of ownership, such as stock.

For example, if a company needs to raise money to build a new factory, it might issue bonds to investors. The investors give the company money, and in return, the company promises to pay them back with interest over a certain period of time. This is a way for the company to raise money without giving up ownership or control.