How is a bondholder similar to a bank?

A bondholder is similar to a bank in that both are lenders who provide capital to borrowers in exchange for interest payments. Just as a bank loans money to individuals or businesses and earns interest on those loans, a bondholder purchases bonds, which are essentially loans to corporations or governments, receiving periodic interest payments (coupons) until the bond matures. Both entities also face risks related to borrower default and interest rate fluctuations, impacting their returns. Ultimately, they play crucial roles in facilitating financing in the economy.