A swap is an agreement made between two parties to exchange cash flows in the future according to a prearranged formula.
Swaps are, broadly speaking, series of forward contracts. Swaps help market participants manage risk associated with volatile interest rates, currency exchange rates and commodity prices.
A swap contract can be on any of the underlying, depending on objective: Interest rates, Cross currency hedge, fixed-float payment, balance sheet hedging, etc..
Although options, forwards, and futures compose the set of basic instruments in derivative markets, there are many more combinations and variations. One of the most popular is called swap.