Relationship: Hypothecation

PPB Banker-Customer Relationship Free JAIIB Capsule 61 views Updated 23 Sep 2026

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PPB · Banker-Customer Relationship

For a vehicle loan where the vehicle remains in the possession of the borrower, what is the relationship?

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The Bank is the Hypothecatee, and the Customer is the Hypothecator.

Unlike a pledge, possession remains with the customer (borrower) in hypothecation, though the bank has a charge over the asset.

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Relationship: Hypothecation — Full Text

For a vehicle loan where the vehicle remains in the possession of the borrower, what is the relationship?

Answer

The Bank is the Hypothecatee, and the Customer is the Hypothecator.

Additional notes

Unlike a pledge, possession remains with the customer (borrower) in hypothecation, though the bank has a charge over the asset.

Part of Principles & Practices of Banking · Banker-Customer Relationship · Last updated 23 Sep 2026

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