The asset or assets that a borrower pledges in order to guarantee repayment of a loan is called as
[amp_mcq option1=”Cheque” option2=”Collateral” option3=”Guarantee card” option4=”Bond” correct=”option2″]
This question was previously asked in
UPSC CDS-1 – 2021
– Common examples of collateral include real estate (for mortgages), vehicles (for car loans), or other valuable assets.