Tightening credit

In economics , a credit crunch (or credit crunch or even a credit crunch – the term credit crunch is also used) is a limitation or a scarcity of credit to businesses and individuals, or a sharp rise in the costs of credit. to the debt(higher borrowing rates , need strong guarantees for a loan, etc.)

The phenomenon is sometimes concomitant with a liquidity crisis , but this is not always the case (a liquidity crisis is a refusal of banks and other financial institutions to lend money , that is to say cash, among themselves).

During periods of credit crunch, creditworthy borrowers can not obtain credit (or only on unreasonable terms) 1 .

Notes and references

  1. ↑ Mingwei Yuan and Christian Zimmermann  [ archive ] , page 1

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