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Unit 4 Ch 3 : Money and Credit — Social Studies STD 10 — Question

CBSE BoardEnglish MediumSTD 10Social StudiesUnit 4 Ch 3 : Money and Credit1 Mark
Question
Why do lenders ask for collateral while lending?
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Answer

The collateral is a kind of surety, which the lender can hold on to. In case of de debtor failing to repay the loan, the lender can recover some money by selling the collateral.

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