Credit refers to an agreement between a lender and a borrower where the lender gives money, goods or services to the borrower in the assurance of future payment. Example: 1. A shoe manufacturer takes two credits for making shoes. One he gets leather with the promise of paying later. 2. Next, he borrows money from the trader as an advance for the order of 500 pairs of shoes. 3. He makes 500 pairs and sells them to the trader who gives him the rest of the amount. 4. He pays the leather supplier and also makes a good profit. The credit plays a positive role because the manufacturer is able to complete production on time with the help of loans. It gives him profit too.