Corporate Bonds: How Investments Work in the Real Economy

Ukrainian businesses need capital not only for large investment projects. Often, it is about much more practical needs: purchasing goods, equipment, fuel, raw materials, fertilizers, machinery, or paying for services without which a company cannot operate steadily and scale.

That is why access to financing for micro, small, and medium-sized businesses remains one of the key issues for the economy. In this context, it is important to speak not only about bank lending, but also about other instruments for raising capital. One of these instruments is corporate bonds.

Bonds: Issuer and Investor

For an issuing company, bonds are a way to raise funding on the capital market. For an investor, they are an opportunity to diversify a portfolio and receive income from a corporate instrument. But the most important question is where this capital is directed after it is raised.

When funds work in the real economy, they stop being just a financial resource. They become an opportunity for businesses to purchase the necessary goods or services today while distributing payment over time. This model is especially important for entrepreneurs dealing with seasonality, unstable cash flow, or rapidly growing demand.

The Activitis Case

In the case of Activitis, this type of financing is also important because, through its fintech infrastructure, the company shows investors exactly where the raised funds are directed. This includes financing working capital for micro, small, and medium-sized businesses, in particular through digital embedded finance tools – the online services WEAGRO and eDilo, which are integrated into B2B sales.

These solutions allow entrepreneurs to purchase the goods and services they need now and distribute payment over time. Examples of this approach include the integration of eDilo into the Epicentr Business platform, where payment by instalments became a new payment method, as well as the partnership with Glovo, aimed at financing businesses operating on the platform.

Who Invests

Using Activitis’ fintech infrastructure as an example, we can see that interest in corporate bonds is forming not only among private investors. The company’s bonds are held by more than 600 investors, including non-state pension funds, venture funds, IT companies, law firms, and private investors.

This shows that corporate bonds are gradually becoming a clearer instrument not only for private investors, but also for businesses and professional market participants. At the same time, for an issuer, this model requires a high level of responsibility: regular payments, a transparent financial model, and the ability to meet obligations to investors.

During the period of the bond issue, Activitis has already made four quarterly income payments to investors in full. For the market, this matters not as a separate corporate fact, but as an element in building trust in the instrument itself.

Regulatory Innovations

A separate topic is the development of regulation. Activitis became the first company to issue bonds under a model new to the Ukrainian market, where the issuance prospectus consists of a base prospectus and the final terms of a specific issue. This approach allows companies to work faster and more flexibly with subsequent issues, as the main information about the issuer has already been approved, while each new issue defines its specific parameters.

Another important aspect is the application of the DvP principle – “delivery versus payment.” It increases the security of transactions, as the transfer of securities and the settlement for them take place simultaneously. For investors, this is an additional element of protection, and for the market, it is a step toward more mature infrastructure.

Market Outlook

In the future, corporate bonds may remain one of the sources of capital raising for Ukrainian companies. At the same time, their attractiveness will depend on several factors: market yield, competition with government instruments, the quality of the issuer, transparency in the use of funds, and stable fulfilment of obligations.

For investors, corporate bonds are not a replacement for government securities, but an instrument for diversification. For businesses, they are an opportunity to raise funding outside traditional bank lending. For the economy, they are a way to channel private capital into the development of entrepreneurship.

And this is precisely the main value of such instruments: they can combine investors’ interest in yield with businesses’ need for accessible capital to operate, grow, and scale.