He added: "Last season was better than my first at the club and I intend to keep that progression going. At my age and at this state of my career I need to be playing on a more regular basis.
"I feel my game has progressed significantly over the last two years at the club, especially as I've switched from midfield to right-back. I feel comfortable there now and I believe I am ready to kick on.
"I love the club and I am proud, especially as a Welshman, to be offered the new deal. It's a great club."
In his first Swans season Collins made only one appearance and made four last season as injury took its toll.
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