The other party wants me to pay a security deposit before suing, is that normal?

Yes, the High Court can order security for costs. Under the High Court Rules 2016, a court may require a plaintiff to provide security if there is reason to believe the plaintiff will be unable to pay the defendant's costs if it loses. This commonly arises when the plaintiff is a company that appears to be insolvent, or is resident overseas with no assets that could be readily enforced against. The court has a discretion and considers factors including the strength of the claim, whether the order would stifle a genuine claim and whether the application is made promptly. The amount may be paid into court or secured by a bond or bank guarantee. You can oppose the application by providing evidence of your financial position and merits.