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Which type of credit applies to utilities that have been consumed but not yet paid for?

Revolving credit

Service credit

Service credit refers to a type of credit arrangement where consumers receive goods or services upfront and agree to pay for them later. This is particularly applicable to utilities, such as electricity and water, where consumers use the services before paying the bill. Unlike other types of credit that might involve a loan or borrowing mechanism, service credit is based on the ongoing provision of a service, where the utility company allows the consumer to use the service with an understanding that they will settle the balance at a later date. This type of credit emphasizes consumption first, followed by payment, which aligns perfectly with how utility payments are structured.

In contrast, revolving credit involves a credit line that can be used repeatedly, such as a credit card, while installment credit is a fixed loan to be paid back in specified amounts over time. Secured credit typically involves a loan backed by collateral, making it different from service arrangements.

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Installment credit

Secured credit

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