Product used by the buyer to exchange variable (or fixed) interest rate for fixed (or variable) interest rate during a period longer than a year. It is usually a principal amount (which is not exchanged, but serves only as basis for calculation) based on which the Bank pays to the client (interest rate swap buyer) regular variable (or fixed) interest rate, and the client pays to the Bank a regular fixed (or variable) interest rate.
That way, the client (company) can synthetically turn loans from variable interest rate (e.g. EURIBOR 3M plus margin per loan) to fixed interest rate (IRS fixed rate plus margin per loan). Product can be quoted to follow company loan in full (depreciation, calculation intervals, etc.).