KEYTAKEAWAYS
Understand the concept of a Creditor, a party that extends credit for goods or services or to whom a debt is owed, and the various forms they can take, including suppliers, lenders, and individuals.
CONTENT
DEFINITION
A creditor is an individual or business entity that extends credit to another party, allowing them to acquire goods or services with an agreement for deferred payment. This arrangement empowers the recipient to obtain products or services promptly, with the commitment to repay the creditor at a later specified date.
Creditors can take various forms, encompassing suppliers, financial institutions, lending agencies, or individuals who offer credit terms. Additionally, a creditor can be anyone to whom a debt is owed, which includes financial institutions that provide loans, businesses that supply products on credit, or individuals who have extended loans.
Creditors typically expect repayment in accordance with the agreed-upon terms, which may include interest or other charges depending on the credit agreement’s conditions..
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