Which of the following is NOT a type of credit?

The correct choice identifies a category that does not commonly define a type of credit. Revolving credit is a flexible form of credit that allows consumers to spend up to a certain limit and repay it over time, such as with credit cards. Noninstallment credit typically refers to short-term loans that do not require regular installment repayments, like personal loans or single-pay loans. Overdraft protection is a feature offered by banks allowing account holders to withdraw more money than they have available in their accounts, functioning similarly to a line of credit.

In contrast, fixed-rate credit is not recognized as a distinct category of credit. Rather, it describes a feature of certain loans or credit products where the interest rate remains constant throughout the life of the loan or credit line, rather than being a specific type of credit on its own. This descriptor applies to various credit types, including installment loans like mortgages or auto loans, but isn’t a standalone type of credit. Understanding these distinctions is critical for financial literacy, particularly for those helping clients navigate their financial choices.