What is a parallel loan and how does it work?

Answer by  adam84 (58)

A parallel loan is an agreement between two companies in two different countries borrow one another's currency for a specific period of time reducing foreign exchange risk for both companies.

Answer by  sm (34)

Taking a cash loan from ones own country to trade it to a foreign corporation that has borrowed from their native bank. Example: Corporation X borrows 20 million US dollars from a domestic bank to trade with corporation Y who has borrowed an equivalent amount from their countries bank.