Credit rating agencies are organizations that assess the creditworthiness of borrowers, including governments and corporations. They provide ratings that indicate the likelihood of a borrower defaulting on their debt. These ratings help investors make informed decisions about lending money or purchasing bonds. The most well-known credit rating agencies include Moody's, Standard & Poor's, and Fitch Ratings. They use various factors, such as financial health and economic conditions, to determine ratings. A higher rating suggests lower risk, while a lower rating indicates higher risk, influencing interest rates and investment choices.