An assessment of the probability that an individual, firm, or country will be able and willing to pay its debts. Such an assessment is based on all available information about the subject’s total assets and liabilities, exposure to risk, and past record in making prompt payment of interest and principal when due. An individual, firm, or government with a good credit rating can borrow or obtain goods on credit more easily and cheaply than one whose credit rating is poor. See also credit-rating agency.