Credit rating provides information predicting firm’s future cash flows and risk under uncertainty and hence represents its intrinsic value. Credit rating plays a role as certifier of credit risk of borrowing firm in financial contract and hence it can have substantial impacts on the stability of debt financing and working capital. This paper investigates the effects of credit rating on volatility of debt financing and working capital and provides evidence that credit rating reduces the volatility of those while improving stability of firm’s financing activities and working capital management. Furthermore, while considering potential endogeneity between volatility of debt financing and working capital, this paper conducts 2SLS. The effect of credit rating on the volatility of debt financing is estimated in the first state estimation and then the effect of the volatility of debt financing on the volatility of working capital is estimated in the second stage. The results show the positive relation between the volatility of debt financing and working capital. This paper provides evidences that information effect and certification effect of credit rating improves the stability of debt financing and the associated working capital. In turn, these evidences address policy agenda that the expansion of credit rating among informationally opaque firms could improve the efficiency of resource allocation in financial markets.