We saw what kind of bills and debts we pay…in the part 1.

So first is we need to acknowledge it as a debt

Second there has to be a cost of not paying the debt. Which means we pay a debt (which we acknowledge as a debt – especially if we have a choice). What are the costs:

Legal costs: lender can sue us for payment, we obviously pay.

Business costs: the lender is from the business community and can rip us apart in the business circles (which matter for us). So we pay off because the cost of not paying is much higher than the cost of the debt. There is nothing moral here, it is just a smart business decision.

Moral costs: the person to whom we owe money is our school teacher, dad’s friend, a person who has to pay a hospital bill,….somewhere there is a conscience which pushes us to pay the bill. I have seen people ignoring this completely too. Not a very strong hold.

Social costs: If we are part of a big society and have a good reputation, we are very much worried about what people will think..that forces us to pay up.

Scared: If the person to whom you owe money is connected to the underworld or to the police, debt gets repaid.

However many people do not repay legally due money to people who cannot put a legal, moral, social, business pressure. If the person cannot switch off future supplies (your doctor cannot cut off your blood supply, can he? ), but gas, credit card, telephone, electricity bills …ARE ALL PAID and that too on time, so that ‘future use’ is not interrupted.

So now you know why debt is repaid. It has nothing to do with gratitude…or ‘ethical’ business practices.