(1) The fund demanders are different. In China, national debt accounts for a large proportion in bond financing, and enterprises are the main demanders of credit financing.
(2) The suppliers of funds are different. There are many channels for the government and enterprises to absorb funds by issuing bonds, such as individuals, enterprises and financial institutions, government organizations and institutions, and the providers of credit financing are mainly commercial banks.
(3) Different financing costs. In all kinds of bonds. The credit reliability of national debt is usually the highest, private enterprises and large financial institutions are also high, while the credit reliability of small and medium-sized enterprises is generally poor. Therefore, the interest rate of national debt is often the lowest among all kinds of bonds, and the financing cost is the lowest, followed by large enterprises and financial institutions, and the bond interest rate of small and medium-sized enterprises is the highest, and the financing cost is also the highest. Compared with the deposit interest rate of commercial banks. In order to attract social idle funds, the bond interest rate of bond issuers is usually higher than the bank deposit interest rate in the same period; Compared with the loan interest rate of commercial banks, the higher interest rate of government bonds and bonds of large enterprises and financial institutions is generally lower than the loan interest rate in the same period, while the lower interest rate of SME bonds may be higher than the loan interest rate in the same period. Besides. Some enterprises also issue convertible bonds, which can be converted into company shares under certain conditions, and companies can sell them at lower interest rates. Moreover, once the convertible bonds are converted into stocks, they become the capital owners of the enterprise and need to repay the enterprise yuan.
(4) Credit financing is faster and more convenient than bond financing. For example, when China enterprises issue bonds, they usually need to go through the formalities of applying for approval from relevant management agencies, and at the same time, they have to do some preparatory work such as printing and publicity. Applying for credit can be decided directly by both borrowers and borrowers, and the procedure is much simpler. Financing through bank credit takes less time than financing through issuing bonds, and the required funds can be obtained faster.
(5) There are differences in the structure and quantity of financing term. Generally speaking, banks are reluctant to provide huge long-term loans, and the financing of banks is mainly short-term funds. Moreover, in foreign countries, when the financial situation of enterprises is poor and the debt ratio is too high, the loan interest rate is even higher than that of Gao Zhan, and the financing of bonds is mainly medium and long-term funds. Therefore, the funds raised by enterprises through bond financing are usually more stable and have a longer financing period than through bank financing.
(6) The restrictions on the use of funds are different. The funds raised by enterprises through issuing bonds can generally be used freely without specific restrictions from creditors, while credit financing usually has many restrictive clauses. Such as restricting the use of funds, restricting other debts of borrowers, and maintaining a certain liquidity ratio and asset-liability ratio.
(7) There are some differences in mortgage guarantee conditions. Generally speaking, most of the national debt, financial debt and corporate debt with good credit are not guaranteed, while most of the credit financing needs property guarantee or a third party guarantee.