Definition "measure of the ""softness"" of a credit reflecting the benefit to the borrower compared to a loan at market rate (cf. grant element)" Reference "'concessionality level'. OECD > Development cooperation directorate > DAC Glossary of Key Terms and Concepts (1.2.2024)"
Comment 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.