Question

Why and how credit play a vital role in any economy?

Answer 1

Answer:

'Credit' refers to an agreement in which the lender supplies the borrower with money, goods or services in return for the promise of future payment. Credit plays a vital and positive role as: (i) Credit helps people from all walks of life in setting up their business, increase their income and support their families.

or

(i) Credit helps people from all walks of life in setting up their business, increase their income and support their families. (ii) To some people loan helps a lot in constructing their houses and get relief from monthly rent. (iii) To others it helps a lot in raising their standards.