What is a Hard Loan?

A hard loan is a loan between a lender and borrower in different countries that is denominated in a hard currency.

How Does a Hard Loan Work?

For example, a hard loan from a lender in Cambodia to a borrower in Thailand may be denominated in U.K. pounds sterling because it is a stronger and more stable currency than either of the other countries' currencies.

Why Does a Hard Loan Matter?

Although a hard loan is exposed to exchange-rate risk, a hard loan substantially reduces the risk that would exist if the loan were denominated in either of the less-stable local currencies.

Ask an Expert about Hard Loan

All of our content is verified for accuracy by Paul Tracy and our team of certified financial experts. We pride ourselves on quality, research, and transparency, and we value your feedback. Below you'll find answers to some of the most common reader questions about Hard Loan.

Be the first to ask a question

If you have a question about Hard Loan, then please ask Paul.

Ask a question
Paul Tracy
Paul Tracy

Paul has been a respected figure in the financial markets for more than two decades. Prior to starting InvestingAnswers, Paul founded and managed one of the most influential investment research firms in America, with more than 3 million monthly readers.

Verified Content You Can Trust
verified   Certified Expertsverified   5,000+ Research Pagesverified   5+ Million Users