Securities lending is a financial transaction where one party, typically an institutional investor, temporarily transfers ownership of securities to another party, often a broker-dealer. The borrower pays a fee for this service and may provide collateral, usually in the form of cash or other securities, to protect the lender against default. This practice allows the borrower to sell or use the securities for various purposes, such as short selling or enhancing liquidity. The lender benefits from earning fees while retaining the right to reclaim their securities at any time, usually after a specified period.