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Credentials provide an efficient way of passing sensitive information (logins, passwords, etc.) to multiple servers. Once a credential is created, it can be used to define input values. In order to create a new Credential you will need 'designer' user role privileges. Only users with 'admin' privileges will be able to view the stored value of a Credential.
Servers are often launched with software that requires credentials in order to access certain resources, such as your code repositories (GIT / SVN). Any type of sensitive information should be stored as a credential because the stored information will be encrypted and will not be retrievable through the web interface.
Note: The Credentials Store is separate from your individual cloud credentials and RightScale account information (Settings -> Account).
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