Which type of credit involves borrowing money with an agreement to pay back in installments over time?

The type of credit that involves borrowing money with an agreement to pay back in installments over time is installment credit. This form of credit allows a borrower to receive a lump sum of money upfront and then repay that amount over a specified period through regular payments, which typically include both principal and interest. Examples of installment credit include personal loans, auto loans, and mortgages.

This type of credit is structured to help borrowers manage large purchases by spreading the cost over time, making it more affordable for the consumer. The fixed payment schedule and the clear terms of repayment make it easier for borrowers to plan their budgets.

In contrast, single-payment credit refers to borrowing that must be repaid in one lump sum at a specific date, while revolving credit provides a credit limit that can be borrowed against, repaid, and borrowed against again, such as with credit cards. Debit credit is not a standard term used in the context of credit types, as it typically relates to direct withdrawals from a bank account.