Banking and Financial Awareness (Soft Loan)

Soft Loan
A soft loan is a loan with a below-market rate of interest. This is also known as soft financing. 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. Sometimes soft loans provide other concessions to borrowers, such as long repayment periods or interest holidays. Soft loans are usually provided by governments to projects they think are worthwhile.
Austerity measures
“Austere” means “strict or severe in discipline”.
“Austerity measures” are strict measures that are undertaken by a government to help bring expenditures more in line with revenues.

• “Austerity measures” can be voluntarily implemented (for example, in order to bring deficits down) or involuntarily implemented (for example, if a country defaults on its debt and is given loans by the IMF).
• “Austerity measures” usually include a combination of spending cuts and tax/fee increases.The most common example of “austerity measures” occurs when a sovereign government’s bond rating is downgraded. This makes borrowing more expensive, and usually forces the government to impose these new measures. Many European countries have either imposed “austerity measures” or are in the process of introducing them.
• Recently Greece Govt. approves austerity measures recently to secure international bailout

--> -->