what is consumer credit in financial services 
consumer credit or consumer debt is personal debt taken on to purchase goods and services although any type of personal loan could be labeled consumer credit the term is more often used to describe unsecured debt of smaller amounts a credit card is one type of consumer credit in finance but a mortgage is not considered consumer credit because it is backed with the property as collateral learn more about the different types of consumer credit 1types of consumer credit in financeconsumer credit in finance is extended by lenders to enable consumers to make purchases immediately and pay off the balance over time with interest it is broadly divided into two classifications installment credit and revolving credit installment credit is a loan of a defined amount issued in a lump sum and is then repaid for a set period of time payments are usually made monthly in equal installments 2installment credit can be used for a variety of reasons including major purchases such as major appliances cars and furniture installment credit usually offers lower interest rates than revolving credit in some cases revolving credit which includes credit cards may be used for any purchase the credit is revolving in the sense that the line of credit remains open and can be used up to the maximum limit repeatedly as long as the borrower keeps paying a minimum monthly payment on time 3it may in fact never be paid off in full as the consumer pays the minimum and allows the remaining debt to accumulate interest from month to month revolving credit is available at a relatively high interest rate because it is not secured by collateral 