Open-end

Another name for this credit category is revolving credit. The reason it is called that is that the loan gotten can be used for purchases of any kind; hence, there is no restriction as to what you can use it for.  The minimum loan amount, as well as the interest, must be repaid before a predetermined and agreed date. Generally, this credit category is unsecured. Therefore, the borrower must pay interest on the loan if they are unable to pay the money in full the before the due date.  Credit cards operate under this principle. When you get a credit card, you can use it for any kind of purchase. However, you are expected to pay the balance before it is due. Failure to do so will cause interest to be charged on the balance. This will continue to accrue until the amount and interest are paid off.