Credit rating in the context of "Commercial paper"

A credit rating agency (CRA, also called a ratings service) is a company that assigns credit ratings, which rate a debtor's ability to pay back debt by making timely principal and interest payments and the likelihood of default. An agency may rate the creditworthiness of issuers of debt obligations, of debt instruments, and in some cases, of the servicers of the underlying debt, but not of individual consumers.

Other forms of a rating agency include environmental, social and corporate governance (ESG) rating agencies and the Chinese Social Credit System.

Agency securities are specific securities that are issued by either Ginnie Mae, Fannie Mae, Freddie Mac or the Federal Home Loan Banks.These securities are backed by mortgage loans, and due to their creation from these particular corporations that are sponsored by the U.S. government, they enjoy credit protection based on either an explicit guarantee from the U.S. Government in the case of Ginnie Mae securities, or an implicit guarantee from the U.S. Government in the case of Fannie Mae and Freddie Mac. Agency securities also used as collateral for the supply of money released by the Federal Reserve. This collateral is chiefly held in the form of U.S. Treasury, federal agency, and government-sponsored enterprise securities.

Due to the expectation of federal backing, these securities historically hold the highest credit rating possible.

Refinancing is the replacement of an existing debt obligation with another debt obligation under a different term and interest rate. The terms and conditions of refinancing may vary widely by country, province, or state, based on several economic factors such as inherent risk, projected risk, political stability of a nation, currency stability, banking regulations, borrower's credit worthiness, and credit rating of a nation. In many industrialized nations, common forms of refinancing include primary residence mortgages and car loans.

If the replacement of debt occurs under financial distress, refinancing might be referred to as debt restructuring.

A personal guarantee is a promise made by a person or an organization (the guarantor) to accept responsibility for some other party's debt (the debtor) if the debtor fails to pay it. In the case of a personal guarantee made by an individual on behalf of another, the person who makes the personal guarantee is usually referred to as a co-signer of a note for a loan. A guarantor can be any party, including an individual or another organization, with a credit history.

A common purpose of a personal guarantee is to allow a loan to be extended to an organization or person with either no credit history or one with a credit rating that is too poor to qualify for a loan.

The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank and international financial institution that aims to collectively improve economic and social outcomes in Asia. It is the world's second largest multi-lateral development institution. Headquartered in Beijing, China, the bank currently has 111 members, including 6 prospective members from around the world. The breakdown of the 111 members by continents are as follows: 42 in Asia, 26 in Europe, 22 in Africa, 10 in Oceania, 9 in South America, and 2 in North America. The bank started operation after the agreement entered into force on 25 December 2015, after ratifications were received from 10 member states holding a total number of 50% of the initial subscriptions of the Authorized Capital Stock.

The United Nations has addressed the launch of AIIB as having potential for "scaling up financing for sustainable development" and to improve the global economic governance. The starting capital of the bank was US$100 billion, equivalent to 2⁄3 of the capital of the Asian Development Bank and about half that of the World Bank. The bank was first proposed by China in 2013 and the initiative was launched at a ceremony in Beijing in October 2014. It has since received the highest credit ratings from the three biggest rating agencies in the world, and has been seen since its inception as a potential rival or an alternative to the World Bank and the International Monetary Fund (IMF).

Credit card debt results when a client of a credit card company purchases an item or service through the card system. Debt grows through the accrual of interest and penalties when the consumer fails to repay the company for the money they have spent.

If the debt is not paid on time, the company will charge a late-payment penalty and report the late payment to credit rating agencies. Late payment is sometimes referred to as "default". The late-payment penalty increases the customer's total debt.

The Social Credit System (Chinese: 社会信用体系; pinyin: shèhuì xìnyòng tǐxì) is a national credit rating and blacklist implemented by the government of the People's Republic of China. The social credit system is a record system so that businesses, individuals, and government institutions can be tracked and evaluated for trustworthiness. It is based on varying degrees of whitelisting (termed redlisting in China) and blacklisting.

There has been a widespread misconception that China operates a nationwide and unitary social credit "score" based on individuals' behavior, leading to punishments if the score is too low. Media reports in the West have sometimes exaggerated or inaccurately described this concept. In 2019, the central government voiced dissatisfaction with pilot cities experimenting with social credit scores. It issued guidelines clarifying that citizens could not be punished for having low scores and that punishments should only be limited to legally defined crimes and civil infractions. As a result, pilot cities either discontinued their point-based systems or restricted them to voluntary participation with no major consequences for having low scores. According to a February 2022 report by the Mercator Institute for China Studies (MERICS), a social credit "score" is a myth as there is "no score that dictates citizen's place in society".