Debt is defined as the amount of money that you owe to somebody. In other words, the debt is what one party or a debtor owes to the second party or a creditor. A debt gets created as soon as any creditor provides an asset to the debtor on certain terms and conditions. In order to pay your debt, you will have to pay an interest rate on top of the amount borrowed.
The popular word debt is derived from the French word dette and from the Latin language’s debere which was used when somebody owed an asset to others. The letter ‘b’ was introduced in the word debt in the 17th century by Samuel Johnson.