Debt is cheaper than equity.
The basic reason is the cost. In terms of how much that company needs to finance debt usually cost around 4% to 9% and equity cost nearly to 20% -25% or higher.

The Interest expense is deducted during the profit calculation of the company for the debt- holders of the company. The dividends paid to equity holders are not exempted to tax.
Debt holders are preferred first for the payout in case of the company's bankruptcy.
Risk is lesser in Debt than equity, hence debt holders enjoy cheaper interest but low dividends rate.