Lender

In finance, the term lender denotes a person or another entity which lends money to another person or entity (a borrower).

When you get a personal loan from a bank, the bank is the lender and you are the borrower. When you use a credit card to pay for goods and services, you are the borrower and the card issuer is the lender. When you buy a bond from a company or government agency, you are the lender and the bond’s issuer is the borrower. Lenders also include mortgage providers, business loan providers and securities brokers which provide leverage.

Typically, lenders charge fees for their service of providing loans. These fees are called interest. Interest is usually charged based on a percentage of the amount of money borrowed.

More on this topic:
Swiss personal loan comparison

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