credit risk

Definitions

Accounting

  • noun a risk that a borrower may not be able to repay a loan

Forex

  • The possibility of non-repayment of debt by a borrower that results in a financial loss to the creditor.  The risk assumed by any lender that a borrower is unable to make the required principal and interest payments for which they are obligated through a loan agreement or in accordance with payment terms. Employees, insurance beneficiaries, vendors also assume credit risk if the expectation of payment is not met due to the payor's inability to meet its obligations.
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