Liquidity risk is the risk that a financial institution or other borrower will be unable to meet its financial obligations as they come due
Debt financing is when companies borrow external money to fund projects, or in the case with startups, to kick start operations.
Companies, generally, whether start ups or blue chips, may at some point in time, during or before the existence of the business, need to seek some form of funding.
From the lender’s side, interest rate is the percentage compensation received from offering a loan service. From the borrower’s side, interest rate is the percentage cost paid to acquire a loan service.