Three important terms of credits are:
(i) Interest Rate: It means how much extra money on the principal amount the borrower has to pay.
(ii) Collateral: It is the security that the borrower has to deposit to the lender. The collateral can be property, vehicle, gold, livestock etc.
(iii) Documents: Documents for obtaining credit may include salary slips, bank statements, saving or fixed deposit documents. The documents give surety to the lender.