soft loan

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Related to soft loan: Hard Loan

Soft Loan

A loan made at no interest or at a below market interest rate. Soft loans usually refer to loans made to developing countries and others in need of financing, but without the ability to borrow at the market rate. Soft loans may also have a longer grace period or a different amortization schedule that makes repayment easier. This is also called soft financing.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

soft loan

a LOAN that bears an INTEREST RATE charge which is much lower than the market rate of interest for such loans. Soft loans are made available by the government to encourage investment in particular types of industrial activity or in particular regions, and by international organizations such as the INTERNATIONAL MONETARY FUND and WORLD BANK to help countries with balance-of-payments difficulties, provide economic aid and to assist industrial development. See INDUSTRIAL POLICY, REGIONAL POLICY.
Collins Dictionary of Business, 3rd ed. © 2002, 2005 C Pass, B Lowes, A Pendleton, L Chadwick, D O’Reilly and M Afferson

soft loan

a LOAN that bears an INTEREST RATE charge substantially below that of the interest rate that is charged normally on a loan for a similar purpose and risk status.

Soft loans are often given as a form of ECONOMIC AID to DEVELOPING COUNTRIES by developed countries and international institutions (see WORLD BANK) and are used as a form of EXPORT SUBSIDY. In addition, soft loans may be used to influence industrial location under a country's REGIONAL POLICY.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
ISLAMABAD: The Ministry of Human Rights has allocated funds to provide soft loans to
She, however, promised to work with the NAIIL through a sustainable business mentoring programme and educate the beneficiaries on how they can access the soft loan scheme of the agency and educate them on CAC registration.
The term of soft loan in yuan is 20 years at 2% per annum.
Soft loan program for the skilled youth will be launched next month and women will be given special incentives in this program.
Soft loan refers to financing with no interest or below market rate of interest.
'The NSB will release a maximum Rs.5 million soft loan with a repayment period of 25 years and at a interest rate of 7% for the first five years.'
On April 15, 2010, the MoO had sent to the central cabinet a proposal worked out by Ameedi's directorate to convert recoverable five-year soft loans from IOCs developing two of the country's giant oilfields into un-recoverable signature bonuses.
The final figure will materialize at the time of the launch of the housing program, but there will undoubtedly be more than one million units sold by soft loans or loans from the Real Estate Development Fund, the Real Estate Development Fund will contribute to lending and also the Public Investment Fund will contribute to soft loan sale in the housing sector.
Participation of the Asian Development Bank in financing is $110 million (with $44.5-million grant and $65.5-million soft loan), while participation of the Eurasian Development Bank is $100 million (100% soft loan).
China has also promised to build the electricity infrastructure in Nepal worth $1.6 billion to counter an Indian offer for a soft loan for the power sector.
Summary: Japan has signed Wednesday a soft loan deal worth EGP 1.2 billion (US$167.7 million) to build a new passenger terminal in Borg Al-Arab Airport.