Types of Credit

Types of Credit

Basically, the credit is banks that lent money or all credit lenders to customers and will be returned at a certain time in the future, along with the achievement counter form of interest. But based on a variety of business purposes as well as various economic elements that affect the field of business customers, then this type of credit to be diverse.

The types of loans are described as follows:

  1. Types of credit in terms of the intended use, are:

    • Consumer credit
      These credits are used by borrowers for consumption purposes, which means that the money will run out of credit used or will be used to meet all needs.
    • Earning credits
      This credit is intended for production purposes in a broad sense. Productive loan used for business improvement efforts both production, trade and investment.
    • Trade credit
      This credit is used for the purposes of trade in general, which means increased utility of place of something good.
  2. Types of credit in terms of usefulness, are:

    • investment credit
      Credit investments are long-term loans which are usually used for business expansion or building projects / new factories or for rehabilitation purposes. Examples of investment credit for example to build or buy the machines. The period of use for a relatively longer period and required capital is relatively greater.
    • Working capital credit
      Working capital loans are loans that are used to increase production in its operational purposes. For example, working capital loans granted to buy raw materials, pay wages or other costs associated with the manufacturing company.
  3. Types of credit seen from that time period, are:

    • Short-term credit
      Loans with maturities of less than one year or a maximum of 1 year and usually for working capital. Examples for livestock, such as poultry or if the credit to agriculture eg rice plants or crops.
    • Medium-term credit
      Credit has a time period ranging from 1 year up to 3tahun and credit usually is used for investment. As an example of credit for agriculture such as an orange, or a goat farm.
    • Long-term credit
      The credit repayment period above 3 years or 5 years. Usually these loans for long-term investments such as rubber, palm is or manufacturing and for consumer loans such as housing loans.
  4. Types of credit in use, are:

    • Credit Checking Free
      Debtor received all the credit in the form of overdraft and he was given a blank check and overdraft loan in the amount of content by loans (maximum credit given). Debtor or customer is free to do withdrawals into account in question during the credits run.
    • Overdraft Loans Limited
      In this system there is a certain limitation for the customers in making withdrawals of money via his account.
    • Credit Current Account Aflopend
      Credit withdrawals made at once within the meaning of the entire credit limit at the time of the first withdrawal has been fully utilized by customers.
    • revolving credit
      Credit disbursement system in the same way with the Free Checking Account usage period of 1 year. But how to use it differently.
  5. Types of credit under the guarantee, are:

    • Unsecured Loans
    • Secured Loans
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