OP is referring to "Credit based flow control", which is a way to ensure a sender does not overwhelm a receiver with more data than it can handle.

Usually, this is line-rate, but if the other side is slow for whatever reason (say the consumer is not draining data), you wouldn't want the sender to continue sending data.

If you also have N hosts sending data to 1 host, you would need some way of distributing the bandwidth among the N hosts. That's another scenario where the credit system comes. Think of it as an admission control for packets so as to guarantee that no packets are lost. Congestion control is a looser form of admission control that tolerates lossy networks, by retransmitting packets should they be lost.

Those token ring folks were on to something.

They'd respond to your kind words, but there are two faulty cables in their token ring network, and as such, no redundant paths for the beacon frame to get through.