Glossary
Creditor
An individual or legal entity, including a bank or licensed financial institution, that is legally authorised to provide loans or credits and has the right to demand repayment of financial obligations from the borrower or loan recipient. The creditor may exercise their rights under the credit agreements in accordance with applicable law, including claiming principal and interest payments and, if necessary, enforcing any provided collateral.
Credit Provider/Lender
A bank or licensed financial institution authorized by law to carry out lending activities, providing loans or credits to individuals or businesses under agreed terms and conditions, usually in exchange for interest and with a specified repayment period.
Credit Recipient/ Borrower
An individual or legal entity that receives a loan or credit from a bank or licensed financial institution under agreed terms, usually in exchange for interest and with a set repayment period. Unlike a loan recipient, who may receive money or goods on loan from private individuals or other organizations, a credit recipient always uses a loan provided by an authorized financial institution.
Credit risk
The risk that a borrower or counterparty will fail to meet their financial obligations, such as repaying a credit or paying interest on time. It represents the probability that one party will default on payments, potentially causing losses to the other party involved in the financial or commercial agreement.
Credit Score / Credit Rating
A numerical assessment of an individual’s creditworthiness, indicating how reliable they are in repaying loans. It is determined by banks and non-bank financial institutions based on algorithmic analysis of income, credit history, indebtedness, and other relevant factors.
Creditworthiness
A comprehensive indicator reflecting the borrower’s ability to meet their financial obligations to creditors on time and in full.
Crowdfunding Platform
An online crowdfunding platform that connects investors with enterprises or individuals seeking financing for projects. Funds can be raised through loans (peer-to-peer lending), equity participation (equity crowdfunding), debt financing (debt crowdfunding), donations, or pre-financed rewards (reward-based crowdfunding). The activities of these platforms are governed by Regulation (EU) 2020/1503 and the Markets in Financial Instruments Act, where they are classified as “providers of crowdfunding services for enterprises.” When offering investment products, they are subject to licensing and supervision by the Financial Supervision Commission. These platforms provide access to alternative investment opportunities but involve risks such as credit risk, lack of guarantees, and regulatory limitations.
Crowdfunding Service Provider
A registered legal entity that carries out intermediation activities through a crowdfunding platform by offering services for raising funds from multiple investors with the purpose of financing projects, start-ups, or other initiatives. The provider is obliged to operate in compliance with the requirements for transparency, investor protection, and regulatory oversight, as set out in the Law on the Provision of Crowdfunding Services and the applicable European legislation (Regulation (EU) 2020/1503). In addition, the provider is required to submit data to the Bulgarian National Bank for the Central Credit Register, providing monthly information about its clients.
Crypto Asset
A digital asset that uses cryptography and blockchain technology for security, ownership verification, and transaction execution. Crypto assets can represent various forms of value or rights, are not issued by a central bank, and are not legal tender, but they can be used for trading, investing, or accessing decentralized services. Examples include cryptocurrencies (e.g., Bitcoin, Ethereum) as a medium of exchange; tokens that provide access to services, voting rights, or ownership; stablecoins pegged to a currency; and non-fungible tokens (NFTs), unique digital assets linked to art, music, gaming, and more.
Partners
