Collateral: meaning, definitions and examples

Used in financial and banking contexts when referring to an asset pledged by a borrower to secure a loan or other credit. Typically used in formal settings.

• The borrower provided his property as collateral for the bank loan.
• Collateral is required to protect the lender in case of default.

Used primarily in financial contexts to indicate an asset that is pledged against a loan. It can also refer to financial instruments like stocks and bonds, or generally to measures for maintaining safety and protection.

• The bank required additional security to approve the loan.
• Investing in securities like stocks and bonds carries certain risks.

Can be used in a broad range of situations, from finance to everyday promises. It suggests a promise of assurance or certainty.

• The manufacturer offers a two-year guarantee on all their appliances.
• He gave his personal guarantee that the project would be completed on time.

Often used in formal or ceremonial contexts to indicate a serious commitment or promise. It can also be used in financial settings when referring to promising an asset for a loan.

• The politician made a pledge to improve education standards.
• She pledged her valuable jewelry as security for the loan.

Used mainly in financial or legal contexts to describe something pledged as security for a loan or an arrangement that is secondary to a primary agreement.

• The bank required collateral before approving the loan.
• This policy serves as collateral to the main contract.

Refers to something that is not primary or the main focus. It can describe a role, function, or importance that is less critical.

• Her secondary goal was to learn a new language while she was abroad.
• Secondary education is crucial for personal development.

Indicates a lower rank or position in a hierarchy. This term often has a professional or organizational connotation and can sometimes carry a negative implication of lesser importance.

• His subordinate was responsible for organizing the team meeting.
• She didn't like the idea of being treated as a subordinate.

Used to refer to something that provides support or additional help to the main function or activity but is not primary.

• The company provides ancillary services such as technical support and training.
• Ancillary benefits like company events and free snacks were also appreciated by the employees.