Credit is a system of providing resources by a creditor (lender) to a debtor (borrower). In this system the debtor need not return the resource immediately; he can later pay back the resource or materials of equal value (with interest). It is not necessary that credit is based on formal monetary system. In barter economics, credit concept can be used. Normally movements of financial capital are dependent on credit or equity system. The cost of credit is the extra charge that should be paid by the borrower over and above the amount borrowed. The interest, arrangement of fees and other charges are included in it. There are some mandatory charges and some optional charges also.

Some common form of consumer credit is credit card, store card, personal loans, retail loans and pret immobilier loans. There are different ways by which interest and other charges are presented. Lenders have to quote all mandatory charges in the form of an annual percentage rate or ARP under many legislative regimes. Optional charges are not included in ARP calculation. Normally credits can be paid by the means of money. However, when the debtor is not able to pay the money in time limit some time simulation pret is done by the creditor and debtor by the means of some discussion. After the time limit is over the creditor take away the mortgage.