Availability of credit
The availability of credit is, in short terms, the easiness for people or companies to obtain a loan for different kind of needs. The different kinds of credits are:
Commercial Credit: Used to finance needs related to commercial activity, buy raw material, merchandise, and machinery or finances charge accounts.
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Consumption Credit: It can by represented by the credit cards, used to cover different kind of expenses for the people.
Micro Credit and PYMES: Small amount of credit to finance productive activities of small organizations.
Guaranteed Credit: in this type of credit the debtor offers and delivers something of value to guarantee a loan. The warranty can be personal or real.
Personal Credit: in addition to the debtor, the loan is signed by another person or entity. This person or entity is called guarantor.
Real Credit: The loan is guaranteed or backed up with a good, such as a house, a car, etc.
Mortgage Loans: Loans to buy or repair a home. The same housing that is being financed or another real estate is used as collateral. Normally, the lenders provide approximately 70% of the value of the mortgaged property.
Renewable Credit: The bank establishes a credit quota, such as an overdraft, and the quota is constantly being renewed as it is being paid.
This availability of credit shows that there are many options and as a consequence an easiness to obtain a credit, This it’s good for our business because people will be able to buy our product even if they don´t have the cash with them.
But also it shows a reduction in consumption disbursed what mean (as it will prove later) a reduction in the propensity of people to spend.
Reference:
https://www.citibank.com.co/educacionfinanciera/finanpers/tiposcredito.htm
https://www.superfinanciera.gov.co/jsp/loader.jsf?lServicio=Publicaciones&lTipo=publicaciones&lFuncion=loadContenidoPublicacion&id=60955