Question

why do the banks collateral while issusing

Answer 1

Bank ask for collateral while giving credit to borrower because if the borrower fails to repay the loan the bank has right to use or sell the collateral given to him by the borrower so that they can get money which they gave him as a loan.

If the borrower gives the loan in time than the bank gives collateral back to borrower.

Answer 2

do you mean why do banks take collateral while issuing loans if this the question
Hee is the answer to this

banks take collateral so that if you are not able to pay the loan they can use the collateral,they can sell it and take the money out