Credit and credit cards are special types of loans. When you use a credit card to buy things, instead of paying for them immediately, each purchase goes onto a big list. At the end of the month, the credit card company adds everything on the list together and sends you a one bill for the total amount of money you spent that month.
The special feature of credit cards is that you do not have to pay back the entire bill right then. Imagine you spent $5,000 last month. When you get the bill, you might only have to use your $1,000 to pay the bill, but you still have all $5,000 worth of stuff you bought.
This functions as a loan because the credit card company has, in a round-about way, loaned you that leftover $4,000. As with a loan, you will still have to pay that $4,000 back eventually, and the credit card company will charge you interest on it. So, in the end, you might owe $4,500 (plus the $1,000 you used to pay the minimum part of the original bill).

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