Credit and debit are terms used to describe two types of payments for goods and services. Credit is a form of payment that allows individuals or companies to purchase items without providing money upfront. Instead, credit is borrowed from a lender – such as a bank or credit union – with the understanding that it will be paid back over time with interest. Debit, on the other hand, is a payment system in which money is taken directly out of an account, usually a checking or savings account, when the customer makes a purchase. Both debit and credit give shoppers convenient ways to make purchases, but the two systems have different implications for the buyer and seller.