Chapter 3

NCERT
Class 10
Economics
Solutions
3. Why do lenders ask for collateral while lending?
Promo GIF

Question:

Why do lenders ask for collateral while lending?

Answer:

At the time of lending, the lender asks for collateral or (guarantee) as security in return for the loan. He does this because in case the borrower fails to return the loan, the lender has the right to sell the collateral to get the payment.

Buy Latest Books

Teacher's Specimen