Which following is a card that allows the holder to make purchases by borrowing money?

• A. Debit Card
• B. Store Card
• C. Charge Card
• D. Credit Card

Answer: (D)

A credit card is designed to let you borrow money from the issuer to pay for purchases, up to a set limit, with repayment due later. You can pay the full balance or carry a balance and incur interest on the outstanding amount. This borrowing aspect is what sets it apart from other cards: a debit card spends money you already have from your bank account, a store card is usually tied to a specific retailer (though it can involve borrowing, it’s limited to that store), and a charge card typically requires paying the full balance each month with no option to carry a balance. So the card that lets you buy now and pay later by borrowing is the credit card.