Credit is a mechanism for borrowing money, goods, and services. It enables the acquisition of such resources without upfront payment, but rather with delayed payment. Activation of credit involves a relationship between a lender and a borrower; the lender assumes a risk that the borrower might default, and the borrower assumes a debt that necessitates repayment at a later time, often with interest. Types of credit include commercial (business), consumer (individual), and public (government). The topic of credit relates to poverty in terms of consumer and public borrowing. For impoverished people, credit generates resources that can lead to human capital development, but it can also trap poor people in a cycle of high-interest debt. Likewise, for countries, borrowed money can be used to finance operations ...

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