Money and Credit | Class 10 Social Science Notes
By ConceptScroll Team · Published on 17 July 2026 · 3 min read
Money and Credit – this guide gives you a concise, exam-ready overview of Money and Credit from Class 10 Social Science, written by ConceptScroll editors and reviewed against the latest NCERT textbook.
TWO DIFFERENT CREDIT SITUATIONS
Credit refers to an agreement where a lender supplies money, goods, or services to a borrower with a promise of future repayment. Credit plays a vital role in economic life but can have varying impacts depending on circumstances. For example, during the festival season, shoe manufacturer Salim obtains credit from a leather supplier and a trader to meet production costs. He repays the loans after making a profit, showing credit's positive role in increasing earnings. In contrast, Swapna, a small farmer, takes a loan for cultivation but suffers crop failure due to pests. Unable to repay, she falls into a debt trap, having to sell part of her land. This shows how credit can sometimes worsen a borrower's situation, especially when risks like crop failure occur. The availability of credit, its terms, and the borrower's circumstances determine whether credit helps or harms.
📊 Diagram: Images illustrating Salim's successful credit use and Swapna's debt trap situation.
🧪 Activity: Students fill a table comparing Salim and Swapna's credit situations and discuss risks and outcomes.
🔗 Connection: This section leads to understanding the terms of credit that govern loan agreements.
Table on page 7 (4×3)
| Salim | Swapna | |
|---|---|---|
| Why did they need credit? | ||
| What was the risk? | ||
| What was the outcome? |
Table on page 16 (9×2)
| Occupations | Reason for needing a Loan |
|---|---|
| Construction worker | |
| Graduate student who is computer literate | |
| A person employed in government service | |
| Migrant labourer in Delhi | |
| Household maid | |
| Small trader | |
| Autorickshaw driver | |
| A worker whose factory has closed down |
Frequently asked questions
Which of the following waste is non – biodegradable:
Tin cans
UNEP has asked all countries to stop the production of CFC ( Chloro Fluoro Carbon) this protocol is called
KYOTO
1. In situations with high risks, credit might create further problems for the borrower. Explain.
In situations with high risks, credit can create further problems for the borrower because if the borrower's income is uncertain or unstable, they may not be able to repay the loan on time. This can lead to a cycle of debt where the borrower has to take more loans to repay the earlier ones, increasing their financial burden. High risks may arise from factors such as crop failure, illness, or loss of employment, which reduce the borrower's ability to repay. Thus, credit under risky conditions can
2. How does money solve the problem of double coincidence of wants? Explain with an example of your own.
Money solves the problem of double coincidence of wants by acting as a medium of exchange. In a barter system, for a trade to happen, both parties must want what the other has (double coincidence of wants). Money eliminates this problem because it is universally accepted in exchange for goods and services. For example, if a farmer has rice and wants shoes, instead of finding a shoemaker who wants rice, the farmer can sell rice for money and then use that money to buy shoes from any shoemaker.
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