An interest rate (market benchmark or reference rate) that provides market participants (specifically, borrowers) with a specified interest rate for the period or maturity of their debts. Hence, this rate is associated with up-front certainty of the interest amount accruing at the end of the interest payment period.

A term rate is an interest rate for a predetermined future term, usually ranging from a medium or longer-term horizon. As opposed to overnight rates, a term rate corresponds to a term consisting of a number of days (beyond one day) and to a certain number of months or even years. For example, a term rate could represent a per annum interest rate with respect to interest-bearing securities (such as notes and bonds).