Credit is fine when it's for investment. Small businesses, companies and governments all use credit to fund capital expansion. That capital expansion then yields growth - the bank gets its money back, the firm makes a nice profit, and everyone's happy.
The issue is when people start using credit as an extension of their income - to buy what they want.
One of the main causes of the crisis was subprime mortgage lending. People borrowed more they can afford. And when they couldn't pay it back, they got angry at the banks.
Of course, banks should have stopped them borrowing. But borrowers have a responsibility not to borrow more than they can afford. If you're less well off, you buy a smaller house.
My parents have a solid credit rating, and they could, if they wanted, take on a huge mortgage, and buy a huge house. But they can't afford it, so they live in a house of the size that they can comfortably pay for.