Term:
Concessionality level - OECD
Definition:
The concessionality level is a measure of the "softness" of a credit reflecting the benefit to the borrower compared to a loan at market rate. Technically, it is calculated as the difference between the nominal value of a Tied Aid Credit and the present value of the debt service as of the date of disbursement, calculated at a discount rate applicable to the currency of the transaction and expressed as a percentage of the nominal value
Domain:
Finance
Source:
Glossary of Key Terms and Concepts. From the "Development Co-operation Report: Efforts and Policies of Members of the Development Assistance Committee".