Contributor: Daniel Parker

This blog post was originally published on TabbFORUM. Collateral as a means of endorsing a promise is as old as human interaction itself. Collateral is even prescribed in the Bible as an ordinary business practice. In fact, a relevant verse of the Book of Exodus reads, “If you take your neighbor's cloak as security for a loan, you must return it before sunset.” Similarly to biblical times, almost all modern pledge practices require some form of collateral to enforce a promise. This blog post was originally published on TabbFORUM. Collateral as a means of endorsing a promise is as old as human interaction itself. Collateral is even prescribed in the Bible as an ordinary business practice. In fact, a relevant verse of the Book of Exodus reads, “If you take your neighbor's cloak as security for a loan, you must return it before sunset.” Similarly to biblical times, almost all modern pledge practices require some form of collateral to enforce a promise. Unlike in biblical times, today collateral can be managed through interconnected repositories and facilitate real-time collateral management across products, counterparties, and regulatory requirements. This process is known as collateral optimization.... read more