Welcome again to the Public Awareness column provided by the Reserve Bank of Fiji (RBF). This month’s article focuses on borrowing money and managing that credit. We also provide some issues you should consider if you are thinking of taking out a loan.
Almost all of us rely on borrowed money at some point to achieve a financial goal –whether it’s buying clothes or a DVD player with a credit card, or taking out a loan to buy a car, a business, or a house. In fact, without some form of credit, many of life’s bigger purchases would be unattainable. But to make borrowed money work for you rather than against you, it’s important to keep credit under control. This fact sheet outlines the ins and outs of obtaining and managing credit.
What is credit?
Credit (or loan) is borrowed money that allows you to buy goods or services now, but pay for them later. Credit cards (such as those offered by credit providers like banks and credit institutions), store/fuel cards (which allow you to purchase in specific stores or retail groups), personal loans, lay-bys and mortgages are all forms of credit.