A Brief History of Credit
Credit is actually a formal bookkeeping and accounting term that refers to the charging of an account balance. The opposite of a credit, in terms of bookkeeping and accounting, is a debit. Assets and expenses in the account decrease when the account is credited. Liabilities, equities, and revenue increase when an account is credited. This information all falls under the realm of the generally accepted accounting principles (GAAP) and is quite commonly confused with other forms of the terms. The most common confusion is that a debit should increase the revenue as many people relate the term to their personal debit cards. On the contrary, the matter is entirely subjective as the bank records it as a debit and so on.
If we shift the term credit to the financial arena, we find that it has a different but related meaning. This is perhaps the definition we are more acquainted with as regular consumers. Used in terms such as "credit cards", credit refers to the granting of a loan and the subsequent creation of a debt. Anytime financial capital, which is any "liquid" medium that represents wealth, moves the term credit is involved as it is quite dependant on credit. This is because the operation is dependant on the credibility of the person or institution accepting the wealth or funds. This is actually where the term credibility comes from.
A credit is determined in a unit of account, which refers to any standard numerically noted measurement of the market value of goods, services, or other marketable items that are transacted. Credit is not money, however, in that it cannot act as a unit of exchange specifically. Instead, it can represent a unit of exchange much like the pieces on a game board represent the actions of a player. Credits do act as mediums of exchange, which refers to the intermediate item or idea used in trade to avoid using the archaic methods of the basic barter system. Because of this, various forms of credit are often called "money" by traders or users and are actually included in corporate estimations of their personal money supply because they designate money supposedly owed. A credit card is the perfect example of the almost symbolic nature of credit.
A payday loan can serve as a credit in that it can sometimes represent actual cash in hand before it turns into cash in hand. You can have a payday loan credited to your account, for example, by Cash Doctors and it can perform the same functions as cash. Cash Doctors also offers a Cash Doctors Card, which functions almost like a credit card in the way that it allows you to manage your instant funds in a way that links your account to an internet or online server and enables you to have your cash instantly. For more information, visit the Cash Doctors web site at www.cashdoctors.com.au.
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