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F585 help me understand this sentence

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    It is a sentence from OCR textbook, foreign aid is any flow of capital to developing countries that meets two criteria:
    it is characterised by concessionary terms; for example interest rates lower than the market rate or longer repayment methods

    What does concessionary mean here? Am I right in thinking the criteria is saying the developing country must have a low interest rate to receive foreign aid, but what is the reason of this criteria?

    concessional loans, meaning low interest rates and a favourable length of time to repay it
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