Who is typically considered a borrower in a financial transaction?

In a financial transaction, a borrower is defined as an individual or entity that seeks to obtain funds from a lender, typically in the form of a loan, which they are obligated to repay over time. The borrower is responsible for making payments, including interest and principal, in accordance with the terms of the loan agreement. This definition aligns precisely with the role a person takes on when they take out a loan with the expectation of repaying it later.

The other options represent different roles in financial transactions but do not align with the definition of a borrower. Providing collateral relates to securing a loan, but it does not inherently identify someone as a borrower. Managing a trust fund involves overseeing assets for beneficiaries, which is a distinct role from borrowing. Finally, a financial institution that approves loans acts as the lender, not the borrower, in the transaction. This clearly establishes why the second option accurately characterizes a borrower within this context.