collateral

Word family

• collaterally
  adverbC2

Synonym discussion

Sense: noun/1

All four words involve something of value offered to protect a lender, but they differ in how formally they are tied to a specific loan. 'Security' is the broadest term — any asset used as protection against default, including property, shares, or even a personal promise. 'Collateral' is a specific kind of security, almost always physical property or financial assets that the borrower formally assigns to the lender. 'Pledge' emphasises the act of handing something over as a promise; it often implies physical delivery (e.g., pawning jewellery at a shop). 'Guarantee' is often a third-party promise, not the borrower's own property (e.g., a parent guaranteeing a child's loan). 'Deposit' refers to money paid upfront, not property. For example: 'The bank required collateral in the form of the house itself' (not a deposit), whereas 'Her father gave a guarantee to cover the rent if she lost her job.'

Common collocations

Etymology

From Latin 'collateralis', formed from 'com-' (together with) and 'latus, later-' (side). The original sense was 'situated at the side'. In the 14th century, English used it for family members not in the direct line (aunts, cousins — those 'on the side'). By the 19th century, it had extended to financial language, where 'collateral' property sits alongside a loan as a side agreement. The medical sense for alternative blood-vessel routes came later in the 19th century.