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A loan is a personnel move in which a team is granted the right to borrow a player from another team, so that he can play for them for a certain period of time, even though he has no contract with them. At the end of his loan spell, the player is expected to return to his original team.
Not common in North America, loans are more frequent in Europe. Typically, it is teams from a higher league who will send younger players to teams playing at lower levels so that they gain valuable first team experience or spare players so that they stay fit. While sometimes some sort of partnership between the loaner team and the loaning does exist, most of the time, there is no link between the two teams and loans can occur basically between any two teams willing to do so. This is in that regard different from the farm team system of the National Hockey League.