Subprime lending refers to the practice of providing loans to borrowers with poor credit histories or higher risk profiles, typically at higher interest rates to compensate for the increased risk of default. These loans often come with less favorable terms, such as adjustable interest rates, higher fees, and stricter penalties for late payments. While subprime lending can help individuals access credit, it also carries significant risks for both lenders and borrowers, as seen during the global financial crisis when widespread defaults on risky mortgages caused severe economic downturns.