I'm assuming this is in relation to individuals that borrow (not businesses). In the US, consistently, good repayment behavior generally leads to higher credit

I'm assuming this is in relation to individuals that borrow (not businesses). In the US, consistently, good repayment behavior generally leads to higher credit rating, which in turn makes it easier to get mortgages, car loans, credit cards, etc at lower interest rates and/or lower deposit requirements. Bad behavior leads to the opposite. In the US, the moral hazard is offset because there is a high reward for good repayment behavior and a major risk for bad repayment behavior. For example, the restructuring for bad behavior usually comes with other problems such as being blacklisted by creditors and/or banks, or not being able to get a nice job (some jobs in the US require good credit rating).