What are the characteristics and nature of credit?

I. The basic characteristics of credit include the following three points.

1. Credit is social

First of all, the social nature of credit is reflected in the social psychological factors. Credit is premised and based on trust. Secondly, credit reflects a social relationship. Credit is not only an individual behavior, but a social relationship that occurs between the credit grantor and the trustee. Finally, the social nature of credit has an increasing impact on economic development and social life. With the development of the times, credit is always in the process of development and change.

2. Credit has ethical and cultural characteristics

Credit belongs to the category of ethics, which is embodied as a kind of moral code to restrain people's behavior. Credit is not only a social relationship or a transaction method, but also a value of human society. In terms of the cultural characteristics of credit, different cultural backgrounds have different understandings of credit.

3. Credit has the basic features of repayment and interest payment in economic and financial contexts

The basic features of credit in the context of economics and finance are repayment and interest payment, i.e., credit is a kind of borrowing and lending, and the condition of borrowing and lending is to repay the principal on time and to pay the price of using the funds, i.e., interest, at the end of the term. Here, credit is a special form of value movement, and there is no transfer of ownership, but a change in the right to use the funds.

2. The nature of credit can be described in four ways.

1. From the ethical and moral level

The essence of credit is: to participate in social and economic activities established between the parties to the moral basis of honesty and trustworthiness "practice" behavior.

From an ethical point of view, "credit" actually refers to a moral quality of "keeping one's word".

2. From the legal point of view

The essence of credit contains two layers: one is a relationship between the parties, but where the "contract" stipulates the rights and obligations of the two parties are not delivered at that time, there is a time lag, there is credit; the second is the rights enjoyed by the parties in accordance with the provisions of the "contract". The second is the rights and obligations of the parties according to the provisions of the "contract".

"General Principles of Civil Law" stipulates that "civil activities should abide by the principles of voluntariness, fairness, equal pay for equal value, honesty and trustworthiness"; "Contract Law" requires that "the parties to be honest with others, and not to deceive, and to seek credit, and to keep their word, and in the content of the contract, the meaning and application of disputes should be based on honesty and trustworthiness. Disputes arise in accordance with the principle of good faith to interpret the contract".

3. From the economic level:

The essence of credit is: "borrowing" and "lending" relationship. Credit is actually "the expectation of receiving a sum of money within a limited period of time".

Credit is the movement of value in the exchange of goods or other economic activities in which the grantor of credit, on the basis of full trust in the recipient to fulfill its promise, with a contractual relationship to lend to the recipient, and to ensure that their own principal can be returned to the flow and appreciation of the value of the movement.

4. Monetary perspective

In the eyes of the credit creation school, the essence of credit is money, money is credit; credit creates money; credit forms capital.

Expanded Information

The basic role of credit, mainly includes five aspects:

1. Credit promotes the optimal allocation of funds and improves the efficiency of capital use.

Through borrowing and lending, funds can flow to projects with higher investment returns, which can enable investment projects to get the necessary funds, and units with surplus funds can obtain certain returns; through credit transfers, so that resources are transferred in time to the place where they are needed, it is possible to maximize the use of resources.

2. Accelerate capital turnover, saving circulation costs.

Because credit can make all kinds of idle funds concentrated and put out, so that a large number of funds originally in a relatively static state of movement, which accelerates the whole society's capital turnover is undoubtedly a huge role, and the use of a variety of forms of credit, but also can save a lot of circulation costs, increase capital production investment.

3. Credit accelerates the accumulation and concentration of capital.

Credit is a powerful lever to concentrate capital. The credit system can make the social idle capital concentrated in a few enterprises, so that the enterprise scale expansion.

4. Credit effectively adjusts the national economy.

The function of credit regulation of the economy is mainly manifested in the state's use of the monetary and credit system to formulate various financial policies and financial regulations, and the use of various credit leverage to change the scale of credit and its movement trend, so as to adjust the national economy.

5. Credit promotes the development of international trade and the formation and expansion of the world market.

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