Debtor

In finance, the term debtor denotes an entity (a person or business, for example), which owes a debt to another entity (a creditor).

When you use your credit card to pay for purchases, you become a debtor of the card issuer until you pay your credit card bill. When you give a friend or acquaintance a private loan, they become your debtor until they repay the loan. When you buy goods or services on credit, you become the debtor of the merchant which provided the goods or services until you pay your bills.

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Editor Daniel Dreier
Daniel Dreier is editor and personal finance expert at moneyland.ch.

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