Question

Credit plays a vital and a positive role as well as a negative role, Explain:

Answer 1

that's a true statement well credit can create both positive and negative situations depending on the circumstances of the borrower
consider an example in which credit plays a positive role a farmer loan from somewhere and received in order to manufacture thousand pairs of shoes within a month so with the help of credit he was able to complete his work on time and answer received a very good amount of payment and return with which he was able to pay his credit as well as live a good life

on the other hand credit can also push the borrower into situation from which recovery is very painful and hence the body caught in a Dept trap
examples a poor farmer who used to grow groundnuts on a small land took a loan from a money lender to grow the crops mid year her crops was hit by pest and she was unable to repay the loan next year she took a fresh Loan this time the crop was normal but it was not sufficient to prepare both of the loans as well as to live a good life so ultimately she was caught in a debt trap