What is PPI?
The abbreviation PPI, as used in the business and insurance context, refers to Payment Protection Insurance; which is alternatively referred to as Credit Protection Insurance in some circles. The workings of PPI are quite easy to understand once one appreciates the workings of the lending process, in which PPI comes up. As it turns out, lenders give money - or whatever commodities they are lending - to borrowers on the understanding that the borrowers have the capacity to service their debts as the payments fall due. In case the borrower is an employed person, it is assumed that they will have the capacity to honor their obligations to their lenders as they fall due - as long as they hold their jobs.
