Document background
The Soft Loan Agreement is designed for use in New Zealand when establishing financial arrangements with concessional terms, typically between social impact lenders, charitable foundations, or government agencies and organizations serving social purposes. This document is particularly relevant when the lending arrangement aims to support social enterprises, community development, or other impact-focused initiatives through favorable financing terms. The agreement incorporates all necessary elements required under New Zealand law, including compliance with the Credit Contracts and Consumer Finance Act 2003, while featuring distinctive soft loan characteristics such as below-market interest rates, flexible repayment schedules, and potential forgiveness provisions. It's commonly used in situations where traditional commercial lending terms would be unsuitable or where the lender's primary objective includes social impact alongside financial return.
