A forward-rate agreement (FRA) is a contractual agreement between two parties that determines the rate of interest to be paid/ranked on a future loan or deposit. This financial instrument allows parties to lock in interest rates for future transactions, providing a hedge against interest rate fluctuations.
A Forward Rate Agreement (FRA) is a financial contract between two parties to exchange interest payments on a specific notional amount of money at a predetermined future date.
An indemnity sold by a financial institution to protect the purchaser against the effects of future interest rate movements. It allows customers to specify the terms of protection.
