A loan is a financial transaction between two parties - the lender and the borrower - in which the lender gives the borrower an amount of money that must be paid back in full. The terms of the transaction are usually governed by a loan agreement which specifies, amongst others, the loan amount (also known as the principal amount), interest rate, loan tenure, drawdown terms, repayment dates (i.e. periodic instalment dates for amortizing loans) and any other fees e.g. administrative fees, prepayment fees or late charges.