Credit

The words debit and credit are both used differently depending on whether they are used in a bookkeeping (accounting) sense, or non-accounting sense. In a non-accounting sense, "debit" is: a sum of money taken from a bank account. In a non-accounting sense, "credit" is a sum of money placed into a bank account. money available to spend. money available to borrow. The reason why individuals see debits and credits in the above manner, is that the bank statement presented by the bank to the customer is the bank's view of the account. The bank views money in a chequing account as money the bank owes to the customer, i.e. a liability, and in the rules of accounting, an increase to a liability account is a credit. Likewise, when a bank lends money to a customer and places the money into the customer's chequing account, the bank has increased its obligation to pay that money, which is a liability, and this increase is a credit and appears in the cre...