Banking & Credit Glossary

It can help savings grow faster, but it can also make debt more expensive when interest keeps building on previous interest.

APR helps compare loans and credit offers, but borrowers should still check fees, compounding, repayment terms, and total cost.

APY is useful for comparing deposit accounts because it reflects how interest earns more interest over time.

Accounts payable is usually recorded as a liability because the business still needs to pay it.

Accounts receivable is usually recorded as an asset because the business expects to collect the money.

In loans, amortization shows how each payment is split between interest and reducing the principal balance.