What is a Creditor?

A creditor is a person or entity that extends credit to another party, such as a bank that lends money to a borrower. The borrower is the debtor, and the debt owed by the borrower to the creditor is the amount of money borrowed plus any interest or fees charged by the creditor.

In other words, a creditor is someone who loans money or provides goods or services on credit, while a debtor is someone who borrows money or receives goods or services on credit. The relationship between the two parties is governed by a contract, such as a loan agreement or a credit card agreement, which outlines the terms and conditions of the credit extended.

Examples of creditors include:

* Banks and other financial institutions that offer loans to individuals and businesses
* Credit card companies that extend credit to cardholders
* Suppliers who provide goods or services on credit terms
* Mortgage lenders who provide home loans to borrowers

It's important to note that being a creditor can involve risks, such as the risk of default by the debtor. Therefore, creditors often require collateral or other forms of security to minimize their exposure to risk.