In the debtor/creditor relationship, who is considered the creditor?

In the context of a debtor/creditor relationship, the creditor is typically defined as the entity or individual that extends credit to another party, therefore expecting to be repaid. In this case, a bank is a key player in lending scenarios, where it provides loans or credit facilities to borrowers, thereby establishing itself as the creditor.

The interpretation of a creditor goes beyond merely lending money; it can also involve providing goods or services on credit, where the expectation is that the debtor will settle the outstanding amount later. Although customers may have credit arrangements with businesses, it is the banks that legally hold claim to the funds lent, making them the creditors in this relationship.

The government and regulators may also have financial relationships with individuals or businesses, but they do not function in the traditional creditor role that involves direct lending. The role of the creditor fundamentally highlights the expectation of repayment and the financial risk taken on by the lender. This is why the bank is appropriately identified as the creditor in a debtor/creditor relationship.