An asset that a borrower uses as a guarantee is called _____.

collateral

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debit card

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credit card

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deposits

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Solution

The correct option is A collateral
Collateral is an asset taken by the banks / money lenders for lending money to its customers.
Collateral is a type of a security taken by the banks from its customers.
Collateral can be in the form of fixed deposit, property documents, etc.

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