Loan provided to a project sponsor with flexible repayment terms. Soft loans are generally subordinate to other debt, can have variable repayment schedules and extended terms, and subsidized interest rates.
A loan bearing either no rate or interest, or an interest rate whch is below the true cost of the capital lent.
Can carry an interest rate below the real cost of borrowing or no interest rate at all. The International Development Association – the World Bank affiliate – provides soft loans to developing countries for long term capital projects.
A loan with generous repayment terms.
a special type of grant where the terms and conditions of repayment are more generous (or softer) than they would be under normal finance circumstances
A loan made with easy or generous terms such as low or no interest and long payback.
Loans that are available without the normal security demands placed on borrowers by clearing banks and other commercial lenders. They usually allow some concessions to the borrower on either security requirements, or on interest rates charged. Payment of little or no interest may be a condition of the loan, and in addition, in some cases borrowers can organise payment holidays.
A loan by a government or multilateral Development bank which carries no (or below market rate) interest, although there is usually a small annual service charge. It is typically extended to developing countries and has a long repayment period. See also Concessional funds. Français: Prêt bonifié Español: Préstamo en condiciones favorables
Loans which carry relatively low rates of interest and an undemanding programme for repayment of the principal amount. Sometimes the relative softness of the terms is linked to the recipient complying with objectives attached to the loan
A loan with generous terms such as lower than usual or no interest, and/or a long payback period.
A soft loan is a loan with a below-market rate of interest. This is also known as soft financing. Sometimes soft loans provide other concessions to borrowers, such as long repayment periods or interest holidays.
