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Credit - Coggle Diagram
Contractual Agreement
The amount of money available to borrow
5CS of Credit
Character
Capacity
Capital
Collateral
Conditions
CLASSES AND KINDS OF CREDIT
According to Wether Merchandise or Money is Given
Merchandise Credit
Borrowing Money
According to Purpose
Export Credit
Industrial Credit
Commodity Loans
Commercial Credit
Agricultural Credit :recycle:
Real Estate Credit
According to Maturity
Medium or intermediate term credit
Long-term credit
Short-term credit
Government or public credit
According to Types of User
Mercantile Credit
Commercial Bank Credit
Retail Credit
Revolving Credit
Consumer Credit
Investment Credit
Characteristics
There is the presence of trust and confidence.
The contract is personal in nature.
Credit is risk
The contract has pecuniary nature. :star:
It is a bipartite contract
Futurity
Creation of legal obligation
The transfer of ownership or title
Functions of Credit
Wealth utilization
Expansion and contraction of money
Enables businessmen to gather large capital
Induces people to save
Elevate moral standards of people
Substitute for money
Advantages
Avoid utility deposits
Better credit rewards
Emergency fund backup plan
Manage your cash flows
Avoid and limit financial fraud
Save on interest and fees
Purchase and travel protection
Disadvantages
High interest rates
Fraud
Easy to overspend
Confusing terms
