Many people are using credit cards or loans to run up huge personal debts that they maybe unable to repay. Ehat arr your opinion?

Nowadays, people are able to reach easily to financial sources by financial instruments such as mortgage loans and credit cards. There are many people who spend money by using credit card or loans without repaying ability. It is the aim of essay to present some benefits and drawbacks when people are not able to borrow money easily.

There are some advantages, when banks dont lead money to people easily. To start with, people are controlled their expedition in order not to spend too much money more than their repaying ability. As a result, this is a possible cause that leads to decreasing crime in society. Furthermore, when financial institutions have less risks, they can lend money to people with low interest rate. What is more, economy will be safer when financial institutions have no risks. For example, in 1996,the Thai financial institutions lent too muh money to people who could not repay. Consequently, it is one of the causes of the crisis in the Thai economy in 1997.

However, when banks are stricter about lending money to people, people need to find another financial source such as to borrow money from mafias or illegal financial institutions. As a consequent, this doesnt support economy and danger of their life. Moreover, banks lose the opportunities to earn more money and to increase monitoring cost.

In conclusion, I think every financial instruments are important in economy and encourage economy to be stronger. However, we should be careful of how to use it because it will be a cause of economic problems such as in the crisis of the Thai economy.